Kumba’s Zim to start new steel firm

[miningmx.com] — Former chairperson of Kumba Iron Ore Lazarus Zim Lazarus Zim said he had resigned from the board of the Anglo American subsidiary to start a new steel firm and avoid the potential of a conflict of interest.

Lazarus Zim had already tried to distance himself from the world’s 10th largest iron ore supplier when Kumba began a legal dispute over mineral rights with ArcelorMittal SA due to his connections with related parties in the deal.

“The steel company will be a totally new player. There will be some players involved from outside the country,” Zim told Reuters, adding more details would be given in the new year.

Zim said he had to resign from the Kumba board to avoid potential conflict of interest should the iron ore producer be a supplier to the new company.

“If we are in the steel business, we will have to get iron ore from somewhere. I can’t be a chairperson and potentially a client of Kumba at the same time,” he said.

Zim had already excused himself from involvement in a dispute over Kumba’s Sishen iron ore mine because of his relationship with Jagdish Parekh.

Parekh is an influential shareholder in Imperial Crown Trading (ICT), a previously little-known company which was awarded a prospecting right over a stake in Sishen, for which ArcelorMittal South Africa previously held a mining right.

Kumba in February terminated a long-term deal under which it sold ore to ArcelorMittal at a discount after the steelmaker failed to convert its rights over a 21.4% stake in Kumba’s Sishen mine into a new right as required by law.

The government granted ICT a prospecting right over the stake in Sishen, a decision which Kumba is contesting in court. Meanwhile ArcelorMittal said in August it would buy ICT to regain the right.