South Africa’s Impala Platinum shares were down 2,7% yesterday after its Zimbabwean unit Zimplats received an order to hand over 29,5% ownership to the National Indigenisation and Economic Empowerment Board within 14 days.
Under the Indigenisation and Economic Empowerment Act, all foreign-owned companies operating in the country are required to sell at least 51% shareholding to locals.
In a letter to Zimplats last week, Youth Development, Indigenisation and Economic Empowerment minister Saviour Kasukuwere ordered the platinum miner to transfer the 29,5% holding within two weeks or the government would take unspecified “enforcement mechanisms”.
Impala owns 87% of Zimplats.
Its shares were down 2,7% to ZAR163,07 compared with a 1% fall in the blue chip index.
According to South African media reports, Implats chief executive officer David Brown is expected in Zimbabwe this week for urgent talks with the government.
In a trading update, Zimplats yesterday said it would be negotiating with the Indigenisation and Youth Empowerment ministry on the release of ground agreement.
Zimplats chief executive officer Alex Mhembere said the platinum mining company received Kasukuwere’s letter dated February 22 2012 advising them that the portion relating to the indigenisation implementation plan for the release of ground agreement entered into in 2006 had been rejected.
“Zimplats is concerned to note the statement by the minister (Kasukuwere) that unless progress is made within 14 days to transfer the required shareholding to the national Indigenisation and Economic Empowerment Fund enforcement mechanisms will be activated,” said Mhembere.
“Shareholders are advised that negotiations with the minister will be undertaken in an attempt to reach a mutually acceptable solution. Shareholders will be informed of further material developments as they occur.”
Shares in Aquarius, which holds a 50% in Mimosa, also plunged last week after receiving a notice rejecting part of its indigenisation plans.
Aquarius Platinum, the fourth-largest producer of the metal fell 5,9% to A$2,08 on the Australian Stock Exchange yesterday after Zimbabwe rejected a joint proposal with Impala Platinum Holdings.
Kasukuwere said Zimplats should abide by the country’s laws.
“People should just follow the laws of the land. These are our laws,” he said.