HARARE – Government is looking for an investor to inject $6 million in once Zimbabwe’s and southern Africa’s biggest drug manufacturer — CAPS Holdings — which has been teetering on the brink of total collapse ever since it started experiencing financial problems more than five years ago.
CAPS Holdings’ Southerton plant at the flagship CAPS Private limited, is currently operating at five percent of installed capacity.
“The issue of CAPS Holdings is largely with the Reserve Bank of Zimbabwe (RBZ) because they want to clear the issues of who owed who among the shareholders.
“As far as we are concerned the shareholder would be government and we should be able to look for a partner who can partner government,” Heath and Child Care minister David Parirenyatwa told the Daily News in an interview.
Government assumed control of the stuttering drug-maker after buying out ex-major shareholder Frederick Mtandah.
This was after CAPS’ faced a critical funding shortfall, with its property escaping a public auction aimed at amortising a $4 million loan owed to two major banks — CBZ Bank and FBC Bank.
Government has since snapped up CAPS’ debts through the Zimbabwe Asset Management Corporation (Zamco), an RBZ unit setup to assume distressed companies’ debts to banks.
At its peak, the struggling drug manufacturer accounted for 75 percent of the local healthcare products market and was involved in the manufacture, wholesale distribution, and retail of pharmaceutical, consumer, and veterinary products.
CAPS is only operating one out of its four plants in the capital, Harare, as a result of lack of funding from new shareholders, government, leaving the country’s health institutions and donors with no option but to procure medicines, including intravenous drip water, outside the country.
It ceased manufacturing drugs and failed to have its 15-year lease of Harare’s upmarket St Anne’s Hospital renewed in 2013, while its QV pharmacy chain has only recently returned to good health under judicial management.
CAPS Holdings had CAPS Private Limited, QV Pharmacies, Farm Centre, McDonald Scientific, Glassblowing Industries and Geddes Limited under its wings as it dominated the local and regional markets.
It had also branches in Botswana, South Africa, Zambia and Malawi.