Zimplats has signed a $971 million deal with the Zimbabwean government which sees the miner hand over 51 per cent ownership for sale to black Zimbabweans.
The agreement between the Implats unit and the country’s government marks the miner stand behind the government’s indigenisation policy, which includes the transfer and sales of land and company ownership stakes to black citizens as part of a black economic empowerment push.
“The transaction being concluded today is a flagship of the policy objectives of our government’s empowerment of indigenous Zimbabweans,” announced Saviour Kasukuwere, Indigenisation Minister at the signing ceremony on Friday, reports Reuters.
He added that the make-up of the new Zimplats shareholders shows that the government’s indeginsation policy is benefiting individuals from the full span of Zimbabwean society, not only those close to the president.
Implats has been under on-going discussions with the government as to the sale of the Zimplats shares under the indigenisation policy, with rumours stemming back to over a year ago suggesting that a “gentleman’s agreement” had been made agreeing to the sale which has now occurred.
Commenting on the deal, Implats Chief Executive Officer Terence Goodlace said: “Now we can start moving on with our business,” adding: “It’s taken more than 18 months to reach this point. It’s extremely important, because what happens if you don’t reach agreement, tensions start running high.”
Noting that there may be changes to made going forward as the new shareholders begin to get involved with the company, Goodlace commented: “We have a whole new set of shareholders and from a relationship perspective it changes things fundamentally.”
Already operating three mines in Zimbabwe, Zimplats has been eager to expand its activities in the resource rich country, and is currently in the midst of a $ 460 million expansion project in the country, to increase output to 270,000 ounces of platinum per year – as of next year -, up from its current production level of 90,000 ounces per annum.
Speaking as to the impact of the agreement on the company’s ongoing plans regarding Zimbabwean operations, Goodlace added: “It has removed uncertainty. There is vast potential [in Zimbabwe] with fantastic geology and a great operating environment.”
The deal sees Zimplats win some favour from the government, with promises having been made to cut ground rental prices to pre-June 2012 levels, as well as a $153 million repayment regarding unmined platinum reserves returned to the government by Implats in 2006 in exchange for empowerment credits.
