[miningmx.com] – THE Zimbabwean government has thrown its weight
behind an “in principle’ agreement earlier this week with Impala Platinum (Implats)
regarding the sale of 51% in local platinum producer, Zimplats.
Saviour Kasukuwere, Minister for Youth Development, Indigenisation and
Empowerment, told Miningmx that the Zimbabwean government would be
prepared to stick to a “once empowered, always empowered’ rule if agreement could
be reached on the valuation of the assets to be sold.
He also hinted that the Zimbabwean government would listen to objections to the
proposed increase in royalties and other duties Zimplats is currently facing, saying
the government would do what was in the interests “… of the continuity and
sustainability of the company [Zimplats]’. Implats currently owns 87% of Zimplats.
Kasukuwere’s comments follow months of rhetoric and argument between his
government and Implats, culminating in an ultimatum in which he said that Implats
ought to comply with the law of indigenisation or leave the country.
In a summit meeting on Tuesday, Implats CEO David Brown presented a proposal for
the sale of 51% in Zimplats to Zimbabwe’s National Indigenisation and Economic
Empowerment Board (NIEBB). The proposal also included provisions for compensation
related to a previous empowerment deal Implats had concluded in 2006.
Brown said on Wednesday that the “in principle’ agreement provided for contributions
from the Zimbabwean government towards Zimplats’ expansion capital, with
consequential dilution if capital rights were not followed.
Kasukuwere promised to discuss the valuation of the compensation, and said that
discussions could commence as early as next week. Vunani Capital would assist with
the negotiation process, he said.
In a signal that the discussions won’t be easy, however, Kasukuwere said that
Implats would still be a major shareholder in Zimplats, to which a certain value was
attached. When asked if he had agreed to compensate Implats for its 2006 deal,
which it valued at $153m, Kasukuwere replied: “What about the ground Implats
keeps?’.
He swiftly added a conciliatory note, however: “But we don’t want to argue this
through the media. We have said to David [Brown] that we hear him. And I know my
brother is under pressure.’
“By next week we need to get cracking,’ said Kasukuwere. “The crux of these
discussion now is on value; that is the main talking point.’
Commenting on a Zimbabwean government proposal that royalties payable by Implats
double to 10% a year from the current 5%, Kasukuwere said: “We need to be able to
make money for all parties. The key principle is to be in a position that allows for the
continuity and sustainability of Zimplats.’
Zimplats is also facing a high ground-rental proposal by the Zimbabwean government
– effectively a rental fee for surface-property rights. In terms of this duty, the
Zimbabwean government has proposed levying $48.5m on Zimplats for its 48,500
hectare property from the current level of $45,000.
“Implats has given us a plan which, in principle, is fine as it captures what we want.
We need to close this as soon as possible,’ Kasukuwere said.
