Implats, which owns the Zimplats mining firm in Zimbabwe and is the country’s largest single foreign investor, has conceded to the ZANU PF led indigenisation campaign, agreeing to a 51% share handover. This 51% is broken down as follows:
– 10% of shares will go to a Community Trust
– 10% will got an ‘employee share ownership trust’
– 31% to the State’s National Indigenisation and Economic Empowerment Fund
Implats said in a statement that: “No agreement has been reached on timing or valuation other than that the transactions would be at appropriate value.” Regarding the handover to the State Fund, Implats said that it “and the Government will explore fair value compensation in lieu of empowerment credits,” and “on receipt of this compensation, Zimplats will make available for sale to the National Indigenisation and Economic Empowerment Fund a 31% fully contributory stake in Zimplats for cash at an independently determined fair value at the time.”
This agreement has followed months of sparring with the Empowerment Minister Saviour Kasukuwere, who has repeatedly threatened Implats unless they comply. Most recently Kasukuwere said the company would face unspecified action unless they agreed to the 51% handover, while lashing out at Implats CEO David Brown and accusing him of “delaying tactics”.
Some observers have criticised Implats for giving in to bullying tactics, while others have argued that the mining group had little choice but to give in, or lose its lucrative footing in Zimbabwe.
The question now is whether or not the company will see a fair pay-out for the shares it has agreed to hand over, which the international mining analyst Liberum Capital Mining has said is unlikely.
“The details of the transfer have yet to be disclosed, including the manner and timing of compensation, which we do not expect to be at market rate given Zimbabwe’s parlous public finances,” Liberum Capital said.
Meanwhile, there has been no mention of the future of the Implats owned Mimosa Mining firm in Zimbabwe, after the government also rejected the indigenisation plan there. – SW Radio Africa NewsPost published in: News