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Implats Zim deal in jeopardy

Harare – Impala Platinum Holdings [JSE:IMP] (Implats) may have to restart negotiations for its Zimbabwean subsidiary Zimplats' compliance with Zimbabwe’s indigenisation policy.

This comes after Empowerment Minister Saviour Kasukuwere said in an interview that he would seek to “correct” mistakes by compelling Implats to make adjustments to its compliance plan, due to take effect in June.

The company’s efforts to fully comply with Zimbabwe’s indigenisation laws, which have been slammed by fund managers and economists, have been thrown into disarray. This follows demands by President Robert Mugabe that Zimplats give away 51% shares for free, after he levelled criticism against Kasukuwere.

Kasukuwere’s keenness to rubber-stamp Mugabe’s demands has been seen as reflecting government sentiment that the Implats indigenisation deal needs to be negotiated afresh. He said in an interview that he will seek to make corrections on the Implats deal.

“When you have your commander in chief (Mugabe) and he marks your book and he sees some mistakes and says make the corrections, that’s what we will simply do,” he said.

A government official said on Wednesday that Implats had to adjust its indigenisation terms or risk degeneration of its compliance plans.

The pressure has apparently been ratcheted up on the JSE-listed platinum miner, with the government also saying it will take over nearly half of the mineral claims belonging to the company.

“It’s a clear issue – Implats has to adjust and accept that it receives no payment for the shares or the whole process starts all over again. But it is also likely that Implats will stand its ground because this has already been agreed and signed,” said the government source.

Mining sector executives said it was unlawful for the government to take over shares in Zimplats without paying.

Mugabe said Zimbabwe would pay for the Zimplats shares ceded by Implats with the platinum deposits Implats is exploiting in Zimbabwe.

Zimplats' woes in Zimbabwe have further been worsened by the government’s bid to take over 27 948 hectares of land belonging to it. This was in addition to demands that platinum mining companies set up a refinery in Zimbabwe in the next two years or risk a ban on raw platinum exports.

While sentiment regarding the company has been shaken, Zimplats CEO Alex Mhembere said on Wednesday the company has no plans to abandon its operations in the country.

"Zimplats remains focused on the full development of its mining resources and a sustained positive contribution to the country and people of Zimbabwe.

"Consultations with the relevant government authorities are in progress," said Mhembere.

 - Fin24

 
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