Textile firm – David Whitehead, has been once more put under judicial management, nearly two and half years subsequent to the High Court's act of lifting a similar reconstruction proposal.
The company was initially placed under the judicial management in May 2005 prior to the cancellation of the management order in May 2008.
Towards the beginning of this year, the company was de-listed from the Zimbabwe Stock Exchange. The company has been under tremendous pressure as a result of the unsustainable wage bill, incessant machinery failures and continuous labor disputes amid other difficulties.
At one point of time, the company was the biggest textile producing firm in Zimbabwe, engaging around 3,000 workers. But it has been confronting adverse circumstances because of the hostile economic scenario.
Diminishing efficiency, labor conflict, boardroom arguments and balance sheets indicating the financial losses incurred by the company in the recent years have seriously jeopardized the company, which had its operations in Gweru, Kadoma and Chegutu.
Over the past several years, the textile sector of Zimbabwe has prospered on the basis of continuous power supplies, low-priced labor, good quality lint as well as prices which are competitive. But these competitive benefits had disappeared. This has caused a number of domestic textile firms to postpone, economize or totally shut down its operations.
Fibre2fashion News Desk-India
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