Failed BEE Company Owes Thousands

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By Kuvee Kangueehi Windhoek The Namibia Meat Board has not yet received a single penny from the Oututa Company despite a court order that the company repay an amount of N$460 000 that it defaulted on last year. Oututa Company, which was supposed to be the financial arm of the Otjozondjupa Communal Farmers Union, received the money in 2001 but failed to make any profit or become sustainable and spent all the money until it was liquidated last year. The failed business enterprise did not only lead to legal tussles, but communal farmer associations, which are affiliated to the Otjozondjupa Communal Farmers Union, are now demanding answers from the directors of the company as to what happened to the community project. The Orutumbo Farmers Association, Okamatapati Farmers Association, Gam Farmers Association and Ovitoto Farmers Association are all affiliates of the Otjozondjupa Communal Farmers Association. A number of the affiliated farmers’ unions are accusing the directors of having used the funds for self-enrichment. One of the directors of the Oututa Company, Cleophas Mutjavikua claims that the money his company received from the Meat Board was not a loan but the agreement was that Meat Board would give the money to the Black Empowerment Company to start a pilot project. Mutjavikua said during his time as the chairperson of the Meat Board, he identified three projects the Meat Board could undertake. “The Meat Board identified the provision of bulls in the northern regions, provision of rams in the southern region and Oututa Company as the three projects.” He noted that the company was supposed to be a Black Empowerment Company which would buy cattle at auctions in communal areas. Mutjavikua said Oututa initially requested for N$4 million from the Meat Board to start the company. “We needed at least N$4 million to have a successful company but the Meat Board was only willing to grant us N$1 million.” He said the Meat Board wanted Oututa to become agents for buyers and not buy animals themselves. He noted that despite knowing that the business would not be viable with a N$1-million starting capital, they still decided to go ahead. “As someone who had experience in the meat industry, I knew that the project would not be successful but we decided to go ahead because we wanted black farmers to start buying cattle in the communal areas.” The former director said the Meat Board to their surprise only forwarded N$460 000 to the new company. “We held our first auction in Okatjoruu and bought approximately 300 cattle at a loss because the speculators who agreed to buy the cattle failed to turn up.” The former Meat Board chairman said the company spent over N$180 000 of the N$460 000 to buy the cattle. Mutjavikua claims that after that auction, business started going bad for the new company as prices of cattle dropped. The company had other overhead costs such as transport, salaries, lease and water bills. The former director of the failed company claims that the company paid N$93 000 for directors’ salaries, N$63 000 for transport, N$46 000 for lease and N$36 000 for water related expenses. He further claims that he quit the company before it was liquidated and there was still N$170 000 in the bank account. “I had to quit because infightings started among the directors and some people were jealous, while the community was accusing us of having misappropriated the money.” A source at the Meat Board who declined to be named said they had not received a cent from the company. He said they were still waiting for their lawyers to advise them on their next move.