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A dispute over a R49.3 million shareholding settlement that multinational grocery retailer Choppies Enterprises reached with former Zimbabwean vice-president Phelekezela Mphoko and his son Siqokoqela will be heard in court.
The father and son are suing prominent politician and lawyer Professor Welshman Ncube for allegedly withholding $1.4 million (R23.7 million) of the $2.9 million settlement that Choppies had agreed to pay to the Mphokos after they had a fallout.
Ncube, who is vice-president of the newly formed Citizens Coalition for Change and former vice-president of the Movement for Democratic Change in Zimbabwe, represented the Mphokos and helped them to broker the settlement deal when they were at loggerheads with Choppies, which is headquartered in Botswana and operates in South Africa, Zimbabwe, Zambia, Kenya, Tanzania, Mozambique and Namibia.
The Mphokos allegedly entered into a 51% shareholding deal with Choppies when it expanded into the country and established 32 outlets in 2013. According to Zimbabwe’s indigenisation law, the duo became majority shareholders of the Choppies outlets, operating under Nanavac Investments.
READ: Choppies, Mphoko dispute finally heads to court
The relationship between the Mphoko family and Choppies soured when former Choppies chairperson and former Botswana president Festus Mogae insisted that the family was given a 7% shareholding free. The father and son, however, said that, according to the country’s law, they were entitled to a majority shareholding.
They denied that they were given shares for free and said that Nanavac, of which they are majority shareholders, borrowed $20 million from Choppies, which would be paid on “revenue from the trading activity” for six months.
Although the Mphokos are still fighting to be paid the full value of their 51% share, they settled with Choppies in 2019 for a payment of $2.9 million.
Ncube allegedly only paid them R25.6 million. According to papers filed in the Zimbabwe High Court, which City Press has seen, the parties had a pre-trial conference on March 29 and agreed on the issues that needed to be thrashed out when the trial starts.
The court will determine what currency the $2.9 million was paid to the Mphokos in. It will also determine if the Mphokos authorised Ncube to pay a portion of their settlement ($1.9 million) to a third party, Future Muvirimi.
The pre-trial conference memorandum read:
The memorandum added that the duration of the trial would be four days. A trial date has not been set yet.
Siqokoqela said that Ncube betrayed the family’s trust: “We regarded him as a brother. We ask ourselves how many people he has done this to.”
Ncube declined to comment, saying that the matter was sub judice.
According to the papers the Mphokos filed in court, Ncube confirmed to the Mphokos that he received the full amount from Choppies Enterprises and he then paid $517 500 to Phelekezela and $730 219 to Siqokoqela.
“Despite our demand, the defendant has failed, neglected or refused to pay the aforesaid balances of $832 500 to the first plaintiff (Phelekezela) and $619 708 to the second plaintiff (Siqokoqela).”
City Press has seen a series of text messages between Ncube and the Mphokos in which he agreed that he involved third parties concerning the outstanding balance and that he was trying to get them to pay.
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