News / National
Ziyambi defends Hwange reconstruction move
13 Nov 2018 at 05:53hrs | Views
JUSTICE minister Ziyambi Ziyambi yesterday told Parliament that he had to put Hwange Colliery under reconstruction without consulting other shareholders because the problems afflicting the company needed swift action to avert possible liquidation.
Ziyambi told the Parliamentary Portfolio Committee on Mines chaired by Norton legislator Temba Mliswa that the company owed government $150 million and had posted a $23 million loss in the half year to June this year.
He said as Justice minister, the law empowered him to put any company under reconstruction without consulting other shareholders if necessary.
The committee said it felt that putting the company under an administrator, Bekithemba Moyo, when it was already under a scheme of arrangement and the board had instructed that a forensic audit be conducted for Hwange, was hasty.
They said the decision made by Ziyambi and Mines minister Winston Chitando would cost government and the struggling Hwange Colliery a lot of money in fees.
"According to documents from the Mines ministry, Hwange was capable of being reconstructed and becoming profitable, and I advise the Attorney-General to proceed and put it under reconstruction," Ziyambi said.
"Section 4(1)(e) of the Reconstruction Act stipulates that when you do that, you have to inform shareholders, and that if in the opinion of the minister it is necessary to avert further harm to creditors of the company, then the minister can take action to put the company under reconstruction without affording shareholders a chance to respond, and I decided to do that at that stage."
Ziyambi said although he had put the company under reconstruction, there was still a provision in the law where shareholders had to be approached within 30 days, and a 14-day notice gazetted so that a judge can confirm or reject whether the reconstruction of Hwange should proceed or be disbanded.
Mliswa then questioned why Chitando, who chaired the Hwange Colliery board until he became a minister last year, recommended to Ziyambi to place the company under reconstruction now, when during his tenure it had made serious losses without recourse to the latest action.
"I do not believe this process is to stop the forensic audit. The administrator will control Hwange and come up with a scheme of arrangement. I am obliged by the law to do what I did, but if a judge then feels what we did was wrong, then we will stand guided by the court," Ziyambi said.
The committee took the administrator Moyo to task over allegations that he refused to allow company secretary Allen Masiye to appear before the committee when he was summoned, and that Moyo even used the "F" word to rubbish the proceedings.
Moyo also failed to disclose how much he would be paid as fees, preferring to say he would be paid according to statutory fees as outlined in the Reconstruction Act.
He told the committee that there was no contract signed or letter of his appointment as administrator, but that he was appointed through a Government Gazette, which raised further questions over the legality of his appointment.
Ziyambi told the Parliamentary Portfolio Committee on Mines chaired by Norton legislator Temba Mliswa that the company owed government $150 million and had posted a $23 million loss in the half year to June this year.
He said as Justice minister, the law empowered him to put any company under reconstruction without consulting other shareholders if necessary.
The committee said it felt that putting the company under an administrator, Bekithemba Moyo, when it was already under a scheme of arrangement and the board had instructed that a forensic audit be conducted for Hwange, was hasty.
They said the decision made by Ziyambi and Mines minister Winston Chitando would cost government and the struggling Hwange Colliery a lot of money in fees.
"According to documents from the Mines ministry, Hwange was capable of being reconstructed and becoming profitable, and I advise the Attorney-General to proceed and put it under reconstruction," Ziyambi said.
"Section 4(1)(e) of the Reconstruction Act stipulates that when you do that, you have to inform shareholders, and that if in the opinion of the minister it is necessary to avert further harm to creditors of the company, then the minister can take action to put the company under reconstruction without affording shareholders a chance to respond, and I decided to do that at that stage."
Ziyambi said although he had put the company under reconstruction, there was still a provision in the law where shareholders had to be approached within 30 days, and a 14-day notice gazetted so that a judge can confirm or reject whether the reconstruction of Hwange should proceed or be disbanded.
Mliswa then questioned why Chitando, who chaired the Hwange Colliery board until he became a minister last year, recommended to Ziyambi to place the company under reconstruction now, when during his tenure it had made serious losses without recourse to the latest action.
"I do not believe this process is to stop the forensic audit. The administrator will control Hwange and come up with a scheme of arrangement. I am obliged by the law to do what I did, but if a judge then feels what we did was wrong, then we will stand guided by the court," Ziyambi said.
The committee took the administrator Moyo to task over allegations that he refused to allow company secretary Allen Masiye to appear before the committee when he was summoned, and that Moyo even used the "F" word to rubbish the proceedings.
Moyo also failed to disclose how much he would be paid as fees, preferring to say he would be paid according to statutory fees as outlined in the Reconstruction Act.
He told the committee that there was no contract signed or letter of his appointment as administrator, but that he was appointed through a Government Gazette, which raised further questions over the legality of his appointment.
Source - newsday
