Hwange to retrench

HARARE - Troubled coal miner Hwange Colliery Company Limited (HCCL) is set to retrench over 1 000 employees to remain viable, a Cabinet minister has said.

Deputy Mines minister Fred Moyo on Wednesday told Parliament that government, with a 37 percent shareholding in HCCL, was implementing various measures to revive the country’s largest coal producer.

“The... area of focus is to right-size employment levels of the company. The company currently employs over 3 000 employees. The business permutation indicates that the correct level of employment will be around 2 000 employees so that is another area of focus,” he said.

This comes as the company recently indicated that it expects to save up to $4 million by trimming its bloated top management.

HCCL, which recorded a $115 million loss in the full year to December 2015, is facing litigation threats from creditors after it failed to service its $310 million debt.

Moyo said government and other shareholders are putting in place a scheme of arrangement to get the creditors to stay all litigation against the listed miner to allow “all revenues and finances that it has to be directed towards the productive efforts”.

The Zanu PF legislator noted that government was also working with other shareholders to reposition HCCL’s fortunes.

“The focus areas at the moment are to re-craft the company’s business model in order to lower overheads.

“The company will now have its main business being operated separately from the social service delivery sector of the current business structure,” he said, adding that this was to assist HCCL recover costs as well as lower the overheads of its operations.

HCCL recently engaged financial services advisory firm, Brainworks Capital, to assist in debt restructuring and capital raising initiatives.

People knowledgeable about events at the Zimbabwe and Johannesburg-listed coal miner said the company is also expected to use its London-listing to secure over $100 million through a bond.

Comments (1)

Of the 1000 employees and their families and friends,hands up those that are going to vote for ZANU PF again in 2018?

Chikata - 27 June 2016

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