15 December 2012

Zimbabwe: Mimosa Agrees to Cede 51 Percent Stake

IMPALA Platinum and Aquarius yesterday signed an agreement with Government for the transfer of a 51 percent stake in platinum producer Mimosa Holdings to indigenous entities. The National Indigenisation and Economic Empowerment Fund will get a 31 percent stake, while Mimosa Holdings employees and Zvishavane communities will get 10 percent apiece.

South Africa's Implats and Aquarius owned 50 percent stake each prior to the latest agreement, but will now share equally the remaining 49 percent stake in the platinum giant.

Senior Government officials who included Defence Minister Emmerson Mnangagwa, Midlands provincial governor Jason Machaya, Chiefs Council president Chief Fortune Charumbira, former Governor for Midlands province Cephas Msipa and a number of chiefs from Zvishavane communities graced the signing ceremony in Harare.

The share purchase or sale agreement was signed by the chairman of the National Indigenisation and Economic Empowerment Board, Retired Lieutenant General Mike Nyambuya, and Mimosa Holdings chairman Mr Gerhard Potgieter.

Rtd Lieut Gen Nyambuya said the agreement affirmed the Government's long held belief that foreign interests were not mutually exclusive.

He said Government's aspirations for a mutually beneficial partnership in the exploitation of natural resources was not only desirable, but also possible.

"These efforts will finally see the majority of shares in Mimosa being owned by indigenous Zimbabweans and, consequently, immense value being disposed for the people of this country," said Rtd Lieut Gen Nyambuya.

The transaction is valued at US$550 million and South African firms have agreed to extend vendor-financing loan to the buyers for the purchase of the shareholding in Mimosa Holdings. The new shareholders will forego dividends until the loan is paid up.

Mimosa has declared US$120 million in net profit over the last five years and is projected to continue doing well. Mr Potgieter said the agreement with Government was an historic moment in the country's foreign investment.

"This is a significant event in the history of this country, the platinum industry and also in the lives of the communities, (Mimosa) employees and the shareholders," he said.

"It is a combination of the efforts of all the stakeholders, facilitated by the Government of Zimbabwe. But here today, what we witness is the biggest indigenisation value agreement signed in the history of Zimbabwe."

In terms of the Indigenisation and Economic Empowerment Act foreign owned companies are required to transfer for value at least 51 percent shareholding to indigenous entities.

Guest of honour at the signing ceremony, Youth Development, Indigenisation and Empowerment Minister Saviour Kasukuwere said a compliant indigenisation plan was an instrument for the reduction and eradication of poverty.

Minister Kasukuwere said this was consistent with one of the objectives of the United Nations Millennium Development Goals.

"We are here to witness an important platinum miner finally implementing an indigenisation plan, which would see the majority of shares (51 percent) in the company being disposed to indigenous entities," said Minister Kasukuwere.

Chief Charumbira said he would organise meetings with chiefs who are the custodians of the Community Share Ownership Trusts, to impress upon them that the shares were meant to benefit communities and not individuals.

Mimosa had earlier released US$10 million towards the establishment of the Zvishavane Community Share Ownership Trust.

In pursuit of its indigenisation and empowerment policy, the Government has so far concluded seven community share trusts in mineral-rich areas across the country including Bindura, Zvishavane, Hwange, Mhondoro, Shurugwi and Marange.

Copyright © 2012 The Herald. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections — or for permission to republish or make other authorized use of this material, click here.

AllAfrica publishes around 2,000 reports a day from more than 130 news organizations and over 200 other institutions and individuals, representing a diversity of positions on every topic. We publish news and views ranging from vigorous opponents of governments to government publications and spokespersons. Publishers named above each report are responsible for their own content, which AllAfrica does not have the legal right to edit or correct.

Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica. To address comments or complaints, please Contact us.