Zimplats to disburse $1,6m

HARARE - Platinum group metals producer Zimplats Holdings Limited (Zimplats) yesterday said it will disburse a further $1,6 million to the Mhondoro-Ngezi Community Share Ownership Trust to fulfil its commitment to the indigenisation programme.

Busi Chindove, the company’s spokesperson, told businessdaily that the money will add on to the $4,1 million that has already been paid out.

“We can confirm that Zimplats is now ready to disburse a further gross amount of $1,6 million,” Chindove said.

She said the transaction will be processed after the Trust’s board meeting to be held this week.

Zimplats recently signed an indigenisation deal with government in which it ceded 51 percent shareholding worth $971 million to locals.

Under the deal, the National Indigenisation and Economic Empowerment Board (Nieeb)’s fund got 31 percent, employees 10 percent while the remaining 10 percent was issued to the Mhondoro-Ngezi Community Share Ownership Trust.

This deal is expected to close by June 30 and will be financed through loan to the indigenous entities at an annual interest rate of 10 percent.

The indigenisation law was endorsed in 2008, but started gaining momentum in the last two years. According to the empowerment law, all foreign-owned companies are supposed to cede at 51 percent shareholding to locals.

No firms are exempted despite nature of business.

“At the launch of the Community Share Ownership Trusts, Zimplats made a commitment to provide the Zimplats Mhondoro-Ngezi Community Share Ownership Trust with seed money of $10 million to enable it to embark on community projects,” Chindove said.

“The commitment was to spread disbursement of this money over a period of three years,” she said.

The indigenous shareholders will also be able to appoint directors to the board.

The $971 million purchase price includes a previous payment from a deal between Zimbabwe and the producer in 2006 under which Zimplats released 36 percent of the company’s resource base, which amounted to 51 million ounces of platinum, in return for empowerment credits.

Zimplats, with a market value around $1 billion, is owned by Impala Platinum (Implats), the world’s second-largest platinum producer after Anglo American.

“We are absolutely not going back on our stance, this is an execution of a board mandate, which we will not alter under any circumstance,”

Implats chief executive Terence Goodlace said upon signing the indigenisation deal. - Business Writer

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