Source: Shareholding squabbles scuttle Zisco deal – NewsDay Zimbabwe February 23, 2019
BY XOLISANI NCUBE
A $1 BILLION Chinese deal to resuscitate the Zimbabwe Iron and Steel Company (Ziscosteel) is facing collapse after government changed its shareholding offer to Zhang Li, the president of Guangzhou R&FA, NewsDay Weekender has learnt.
The Chinese billionaire, who is into real estate development, had until last month been pushing to start work on the collapsed steel giant.
But early this month, according to sources, the investors started to pack their bags after they failed to agree on the shareholding structure.
“At first, the Chinese guy was offered 100%, but then it later changed to something like 48%. The Chinese team did not like the new deal,” a source from the Industry ministry
Industry minister Nqobizitha Mangaliso Ndlovu was not answering his phone yesterday.
In January last year, President Emmerson Mnangagwa promised that Ziscosteel and Shabani Mashaba Mines would begin operations within his first 100 days.
However, no activity has yet started at the two entities, which used to provide thousands of jobs and other downstream benefits into the economy at their peak.
Ziscosteel, which at its peak had a 5 000-strong workforce, officially closed its doors in 2016 and laid off its remaining workers without terminal benefits.
Most of its infrastructure, equipment and spares have either been vandalised or looted over the years of the company’s redundancy.
In 2006, Indian firm Global Steel Holdings Limited courted Ziscosteel and was to inject $400 million in a rehabilitate, operate and transfer arrangement.
In 2011, Essar Africa Holdings’ bid to take over in a deal worth $750 million also hit a brickwall due to bickering in the then inclusive government.
“Already, equipment which was being assembled on site has been dismantled and there is no hope for the revival of the mine in the near future,” another source said.
Ziscosteel’s revival is expected to trigger growth in Hwange Colliery Company Limited, National Railways of Zimbabwe and other companies.
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