Business / Companies
Essar Africa's takeover of Ziscosteel yet to be finalised
25 Nov 2011 at 04:52hrs | Views
Essar Africa's $750 million takeover of Ziscosteel has yet to be finalised as 3 prominent individuals have lodged cases in court laying claim to mining assets belonging to Buchwa Iron Mining Company (Bimco) which should be transferred to Essar.
Evidence has emerged that the deal sealed in March was teetering on the brink of collapse as the trio, with links to Zanu PF, are claiming ownership of some of the mining claims.
Mines minister Obert Mpofu confirmed that the deal was being bogged down by legal wrangles but insisted that it would sail through since the state owned all minerals in the country.
"There are three claimants to part of Bimco mineral claims who have approached the courts to stop the deal going ahead," said Mpofu.
"As a ministry, we don't recognise them as all minerals are reposed in the state and no individual could have sold them the claims legally."
Mpofu declined to divulge the names of the litigants in the case saying the matter was before the courts. However, it has emerged that 3 individuals linked to litigation against Bimco are Defence minister Emmerson Mnangagwa, MP Edward Chindori-Chininga and exiled businessman Mutumwa Mawere.
Sources have said that the trio's claims are significant enough to force a renegotiation of the deal or see a complete collapse of the largest foreign direct investment in Zimbabwe in the last decade.
The trio are said to have bought the Bimco claims from Ziscosteel between 2007 and 2009 when the company was struggling to pay salaries to its employees numbering close to 5 000. "Mnangagwa and companies associated with him bought some Ziscosteel properties, among them Redcliff Hotel and blocks of iron claims in Chivhu area, around 2007," a source said.
"The sale was done as the company tried to stay afloat during the hyperinflation era." Mawere and Chindori-Chininga are said to be involved in legal battles to control the Bimco iron ore claims through a proxy.
Evidence has emerged that the deal sealed in March was teetering on the brink of collapse as the trio, with links to Zanu PF, are claiming ownership of some of the mining claims.
Mines minister Obert Mpofu confirmed that the deal was being bogged down by legal wrangles but insisted that it would sail through since the state owned all minerals in the country.
"There are three claimants to part of Bimco mineral claims who have approached the courts to stop the deal going ahead," said Mpofu.
Mpofu declined to divulge the names of the litigants in the case saying the matter was before the courts. However, it has emerged that 3 individuals linked to litigation against Bimco are Defence minister Emmerson Mnangagwa, MP Edward Chindori-Chininga and exiled businessman Mutumwa Mawere.
Sources have said that the trio's claims are significant enough to force a renegotiation of the deal or see a complete collapse of the largest foreign direct investment in Zimbabwe in the last decade.
The trio are said to have bought the Bimco claims from Ziscosteel between 2007 and 2009 when the company was struggling to pay salaries to its employees numbering close to 5 000. "Mnangagwa and companies associated with him bought some Ziscosteel properties, among them Redcliff Hotel and blocks of iron claims in Chivhu area, around 2007," a source said.
"The sale was done as the company tried to stay afloat during the hyperinflation era." Mawere and Chindori-Chininga are said to be involved in legal battles to control the Bimco iron ore claims through a proxy.
Source - Independent
