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Heavily armed Police on Friday locked out hundreds of David Whitehead and Sons employees, including acting chief executive Evelyn Mwapasa, saying the authorities have ordered that the state-owned textile company, which is at the centre of a controversial sale, should be closed.
“There is heavy presence of armed police at the company. Police have taken over the factory and nobody is being allowed in,” Mwapasa said in an interview through her mobile phone Friday morning.
She said she found a tense situation when she reported for work at 7:30 AM when armed police manned the entrance gate telling the company’s 400 workers not to get in.
Mwapasa said in the thick of the tension she asked her staff to peacefully go back home until further notice.
She quoted Privatisation Commission executive director Maziko Sauti-Phiri as telling her in a telephone discussion on Thursday evening that “authorities have ordered that the company should be closed with immediate effect.”
But Sauti-Phiri said in a later interview the decision to close the company and deploy armed police officers must have come from the shareholders.
“No one from the Privatisation Commission has been to Whitex today and we don’t employ police officers. Ask the shareholders [government] because we only sell public enterprises on their behalf,” said Sauti-Phiri.
Finance Minister Friday Jumbe, whose ministry runs Whitex, was reported to be in a day-long cabinet meeting at Sanjika Palace in Blantyre when contacted on his mobile phone.
Whitex management and staff are protesting the K73 million price at which the Mapeto/Jimtex Consortium was offered the company.
Mwapasa said on Thursday DWS management and staff are neither against the buyers nor objecting to the privatisation process but the K73 million price to be paid in 10 instalments which she described as “a big joke”. The right price, according to the staff, is at least K300 million.
Said Mwapasa: “We are convinced this is a bad deal. We don’t think as a country we should be mishandling assets the way this transaction has been conducted.”
But a statement from the Commission published Friday said the objectives of DWS privatisation were, among other things, to alleviate the government from the burden of financially supporting the company; the selection of an investor with sufficient technical and financial expertise to invest in the much needed spares and machinery and forward linkages to the production of quality cotton material in the light of the Africa Growth and Opportunity Act (Agoa) trade window to the American market for sub-Saharan African countries.
“As a result of the issues highlighted, maximisation of proceeds was not a major objective. Accordingly, the price receivable was awarded much less weighting in the evaluation criteria,” reads the statement signed by Sauti-Phiri.
The statement also says the scale is tipped in favour of concluding the Whitex transaction as failure to do so will tarnish the image of Malawi as an investment destination.
Protests over the handover of the textile manufacturer turned ugly on Thursday when angry workers assaulted Privatisation Commission consultant Arthur Stevens, who works for Economic Resources Limited, when he went to the company to collect information on the handover.
Whitex, officially opened by former head of state the late Kamuzu Banda on December 17, 1977, currently produces 4.8 million metres of cloth per year compared to 41 million metres a year at the peak of production a decade ago.
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