Mixed fortunes for platinum miners

HARARE - Zimbabwe's largest platinum producer, Zimplats Holdings Limited (Zimplats)’s, indigenisation plan has been approved but the country is yet to give Mimosa Mine the green light to implement its proposal.

The miner's chairman Sydney Mufamadi said government authorised the platinum giant to sell 10 percent of its equity to employees as a way of complying with the country’s empowerment rule.

“Following the rejection of the indigenisation implementation plan (IIP) non-binding term sheet signed in January 2013 with the Government of Zimbabwe, your company has continued to engage with the government with a view to agreeing on a mutually acceptable IIP,” he said.

“In this regard, Zimplats and the government have agreed on the sale of a 10 percent equity stake to the Zimplats Employee Share Ownership Trust (Esot) as part of Zimplats’ IIP,” he added.

Mufamadi said the process for the sale of this 10 percent equity stake to the Esot was now awaiting approval by the Reserve Bank of Zimbabwe (RBZ) of the vendor financing arrangements pertaining to the sale.

“Once the RBZ approval has been obtained, Zimplats will proceed with the implementation of the sale of the 10 percent share holding to the Esot. It is my sincere hope and belief that we will ultimately achieve a position on Zimplats’ IIP that will be fair and equitable to all the parties and, most importantly, that will preserve the interests of all stakeholders,” he said.

On the other hand, Mimosa — jointly owned by South Africa’s

Impala Platinum and Aquarius — has not found joy in its negotiations with the Zimbabwean government.

In its full year results released this week, Mimosa said it continues to interact with the ministry of Indigenisation and ministry of Mines to work towards a sustainable solution in relation to indigenisation.

“But in the period under review no agreements or definitive terms were agreed between Mimosa and the ministry of Indigenisation. As a result, the matter is ongoing and management is unable to estimate the financial impact of any proposed transaction,” the company said.

Both Zimplats and Mimosa submitted their indigenisation plans in 2012, but the agreements were later cancelled after a lot of irregularities were unearthed by the Daily News — in a scandal that became known as Niiebgate.

The indigenisation law, which came into effect in 2010, obliges foreign and white-owned businesses with a net worth of more than $500 000 to hand over 51 percent of their shares to local black businesspeople.

However, following pressure from the International Monetary Fund and other stakeholders, government was forced to allow for flexibility on the law by empowering line ministries to oversee compliance and implementation.

The ministries can also allow time flexibility on meeting the stipulated 51/49 share holding structure. Finance minister Patrick Chinamasa (pictured) said the clarification will help the country attract more foreign investment.

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