HARARE — At least 76 distressed companies applied for judicial management and liquidation last year, compared with 63 in 2012 as the economy continues to flounder, the High Court in Harare said on Monday.
In 2013, at least 37 companies were placed under judicial management compared with 20 in the year 2012 while 39 were placed under liquidation compared to 43.
“The figure for the companies under liquidation for the year 2013 also includes some companies which were placed under judicial management in previous years and failed to succeed,” the court said in written response to The Source.
At least four or more cases of judicial management and liquidation are heard every week at the court, it said.
Last week, the High Court in Bulawayo said more than 300 companies in Bulawayo and the Midlands applied for liquidation last year alone and raised concerns that some of the firms were using the provision for judicial management to avoid paying their debts.
It said the high number of companies being placed under judicial management or liquidation was also due to undercapitalisation, gross mismanagement, lack of effective corporate governance structures and a high level of indebtedness. — The Source
