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Rebuttal: Addressing the Flaws in The Sentry’s Report on the Mutapa Fund

Kuvimba acting chief executive Trevor Barnard
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THE report by The Sentry, possibly penned by an overly eager Nick Donovan. In short, the report is superficial and lacking in depth. Here is my detailed analysis:

The core assertion of The Sentry’s report is that the Mutapa Fund overpaid a significant amount to shareholders described as “mysterious.” However, the report contradicts itself by naming these shareholders.

The entities in question are legally recognized companies that can sue and be sued in their own right, underscoring a fundamental principle of modern corporate law that separates companies from their shareholders. This separation is crucial; without it, corporate structures would regress to primitive forms.

The inconsistency in The Sentry’s report is glaring. While claiming the shareholders are unknown, it names them, demonstrating a lack of coherence in their argument. For instance, when JP Morgan’s ship was involved in a drug scandal, the focus was not on the shareholders. The same logic applies here – Kuvimba’s shareholders are legal entities, and their identities should not be the central concern if they are compliant with legal norms.

The Sentry’s report appears to be driven by an external interest in local transactions within a sovereign nation, which raises questions about their motivations. Why should foreign entities be so concerned with the shareholders in a local transaction? This intrusion into Zimbabwe’s sovereign affairs seems unwarranted and possibly politically motivated.

Kuvimba Mining House, which holds significant mineral assets, was formerly managed by foreign entities, including Anglo-American. The transition of ownership to Chinese stakeholders between 2013 and 2019 did not raise eyebrows from The Sentry or similar watchdogs, despite the company’s mismanagement and financial woes during that period. It is only now, with Kuvimba’s resurgence and stake sales to Mutapa, that these foreign interests have become vocal.

The Sentry’s reliance on secondary reports, such as those from NewsHawksLive, rather than direct evidence, undermines the credibility of their findings. They question the valuation of the transaction without providing a solid basis for why their valuation should be deemed more accurate or appropriate than that of the actual parties involved.

Kuvimba’s assets, including gold, nickel, copper, and platinum group metals, are of strategic national importance. The narrative suggests that The Sentry’s sudden interest is less about corporate governance and more about the control of these valuable resources.

The Sentry’s report, and by extension Nick Donovan’s analysis, falls short on multiple fronts. It displays a fundamental misunderstanding of corporate structures, an unwarranted intrusion into sovereign affairs, and a lack of rigorous evidence-based reporting. The focus on Kuvimba’s shareholders being “mysterious” is a red herring, detracting from the legitimate business transactions and governance within Zimbabwe.

In sum, while the report aims to cast doubt on the Mutapa Fund and Kuvimba, it instead reveals a shallow and weak understanding of the complexities involved. Future discourse on such matters should strive for greater depth, accuracy, and respect for the sovereignty of nations.

Source: MMatigari