Under-pressure Zimbabwe Platinum Mines (Zimplats) has assured its shareholders that its operating licence was safe and had not been terminated.
Zimplats last week caved into pressure from the government to comply with the indigenisation and empowerment rules as it agreed to submit a revised indigenisation proposal by November this year.
In a trading update to shareholders, Zimplats chief executive officer Alex Mhembere acknowledged receipt of communication from Indigenisation and Empowerment minister Saviour Kasukuwere advising the company’s indigenisation plan did not meet the minimum requirements of the law.
The law requires that all foreign-owned companies with investments exceeding $500 000 should cede at least 51% shareholding to indigenous Zimbabweans.
“Shareholders are advised that the company’s operating licence has not been cancelled and discussions between management and the relevant authorities in this regard are on-going despite the minister’s letter of 6 September 2011. We will continue to inform shareholders of on-going material developments,” said Mhembere.
In his letter to Zimplats Kasukuwere said he had since requested the Mines and Mining Development minister to cancel the company’s operating licence.
“This development follows several meetings between management and the relevant authorities on the Zimplats Indigenisation Plan. The only major area of disagreement is the implementation, in its current form, of the Release of Ground Agreement of 2006,” said Mhembere.
“The government acknowledges the existence and validity of the agreement, but wants to renegotiate certain terms of the agreement.”
Zimplats last week wrote to minister Kasukuwere seeking permission to engage independent experts to evaluate its business after which it would then formulate a revised indigenisation plan, sources said.
Zimplats currently employs 4 000 workers, including contractors and projections were that the conglomerate would employ 6 000 within the next two years and another 10 000 in five years.
Zimplats deputy chairman Muchadeyi Masunda on Wednesday met Kasukuwere to try and iron out differences.
Masunda said the main bone of contention revolved around the Release of Ground Agreement.
“Whilst the government of Zimbabwe has no qualms about the validity of the agreement, it effectively wants to wriggle out of its obligations,” said Masunda.