12 January 2013

Zimbabwe: Govt, Zimplats Ink Share Transfer Deal

GOVERNMENT and Impala Platinum Holdings yesterday signed terms for the Zimplats indigenisation implementa-tion plan to pave way for the transfer of controlling stake in the entity from the South African firm to indigenous Zimbabweans.

The agreement was signed by Youth Development, Indigenisation and Empowerment Minister Saviour Kasukuwere and Implats group chief executive officer Mr Terence Goodlace.

Under the deal, Implats will sell shares in Zimplats to Mhondoro-Ngezi, Chegutu and Zvimba Community Share Ownership Trust (10 percent), Employee Share Ownership Trust (10 percent) and 31 percent to the National Indigenisation and Economic Empowerment Fund.

The shares are valued at US$971 million and Zimplats will facilitate the transaction by providing vendor financing at an interest rate of 10 percent per annum.

Minister Kasukuwere hailed the transaction as the biggest ever in the country.

He said the deal dispelled claims in some quarters that the empowerment programme would benefit a few influential individuals.

"Our emphasis on broad-based participation has clearly shown that the indigenisation programme in the main does not benefit elite indigenous persons, but rather broad based groups of indigenous Zimbabweans.

"To date, my ministry has achieved for communities around the country the value in the form of shares in mining companies in excess of US$1 billion," he said.

He said at least US$110 million had so far been distributed to community trusts while over 800 companies have had their proposals to dispose of shares to their workers approved.

"It is therefore apparent that the greatest beneficiaries of the programme to date are not well-to-do individuals, but broad masses," Minister Kasuku-were said.

He said Government's programme of empowerment was in line with the Millennium Development Goals and other international instruments that local communities should benefit from their resources.

Minister Kasukuwere dismissed allegations by detractors of the programme that Government was compulsorily acquiring shares.

"Shares in non-indigenous business, as in this transaction, are acquired under the programme for full value and this has been demonstrated through a series of transactions that have been concluded with major investors.

"Some of our colleagues in Government have been peddling falsehoods that the law will be amended to make exemptions for investments in certain areas of the economy. The law will not be amended because there is no need to do so," he said.

"We have shown that the provisions of the law allow Government to lower the threshold of indigenisation in areas such as massive investments for a certain period of time. Unfortunately despite our overtures to implement this regime our colleagues have continued to engage in cheap politicking and unnecessarily confusing the investors."

He said Zimbabwe was still open to foreign investment but said the investment should be for the benefit of Zimbabweans and the country as a whole.

Minister Kasukuwere said his ministry was in the process of crafting a comprehensive economic empowerment policy.

"Among other things this new policy will focus on creating new business largely owned by indigenous Zimbabweans, propose new ways of accelerating rural development and growing the economy to levels never seen before," he said.

Minister Kasukuwere also warned non-compliant companies, especially in the banking sector to respect the country's laws by adhering to the indigenisation laws.

Speaking at the same occasion Mr Goodlace said the agreement was an example of how Government and companies could work together for mutual benefit.

"Today is an important landmark for Zimbabwe and our company and will in all likelihood be chronicled as an achievement of how companies and the Government of Zimbabwe came together to advance the interests of all," he said.

Mr Goodlace said the prospects of the company were bright.

"I am, despite these hard times, excited about the future for Zimplats and platinum mining in Zimbabwe. To start with, the uncertainty that had dogged Zimplats during the negotiations is now hopefully a thing of the past.

"The participation of Zimbabweans at a shareholding level will create a sense of ownership as our partners become actively involved in the extraction of platinum group of metals, which will remain a critically important aspect of the country's mineral development," Mr Goodlace said.

He said the investment into Ngezi Phase 11 project at a cost of US$460 million was at an advanced stage.

Negotiations between Government and Implats on the indigenisation implementation plan have been going on for the past year and half while the final agreement is expected to be concluded by June 30.

Local Government, Rural and Urban Development Minister Dr Ignatius Chombo, Minister of State in Vice President Joice Mujuru's Office Sylvester Nguni and president of the Zimbabwe Chief's Council Fortune Charumbira and several chiefs attended the signing ceremony.

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