ZESCO has sued its former managing director Cyprian Chitundu following his refusal to hand over 10,000 shares he continues to cling on to, on behalf of the power firm, in the Kafue Gorge Lower Power Development Corporation (KGLPDC).
The power company has since asked the Lusaka High Court to compel Mr Chitundu to surrender the shares to the current Zesco managing director, Victor Mundende, following the termination of his employment.
It wants the court to declare that Mr Chitundu held the 10,000 shares in the Zesco’s Special Purpose Vehicle by virtue of his office as the then managing director of the firm.
A writ of summons filed in the principal registry indicated that in 2013, Zesco incorporated the KGLPDC as a Special Purpose Vehicle (SPV) for the development of the 750 Megawatt hydro power project situated in Chinkankata District.
The company stated that the shareholding structure for the SPV provided that Zesco hold 990,000 shares with the balance of 10,000 shares being held by the incumbent managing director at the time.
The power company indicated that the 10,000 shares were allotted to Mr Chitundu by virtue of office and as provided for under the Articles of Association.
It claimed that the 10,000 shares allotted to the office of the managing director had no monetary value and were subject to being transferred to the incumbent and, in the event of change of office could be susceptible.
The firm had on several instances sought to engage Mr Chitundu for the purpose or actuality to share transfer from him to Mr Mundende, but this had come to no fruition.
It said the situation had raised an impediment in the holding of shareholder meetings as Mr Mundende was not able to attend meetings or carry out other functions of a shareholder as prescribed by the Articles.
Zesco has as a result suffered loss and damages.