Essar to decide on Zisco’s subsidiaries

subsidiaries in the region, an official said yesterday.
Essar acquired a controlling stake in Zisco this month, and also took over three defunct subsidiaries of the steel maker in Botswana, Zambia and South Africa as part of the deal.
Zisco chief executive officer Mr Alois Gowo told New Ziana that Essar will soon decide on the future of the three regional subsidiaries, namely Monarch Steel of Zambia, Ramotswa-Tswana (Botswana) and Mac Steel of South Africa.
“A decision would soon be made on whether the new partner (Essar) is interested in restoring or selling the plants in South Africa, Zambia and Botswana,” he said.
Mr Gowo said a team from Essar would soon visit Zisco for a meeting to decide on the future of the subsidiaries.
“Next week, Essar people will come to discuss the status of the subsidiaries among other issues. The plants are no longer operating,” he said.
Mr Gowo however, noted that it was in the interest of Essar to revitalise the plants in order to dominate steel production on the continent.
Operations at the three plants ground to a halt in 2008, owing to dwindling production at the mother company.
Zisco has five other subsidiaries in the country, namely Kabwe Steel, Lancashire Steel, BIMCO, ZIMCHEM Refineries and the Zisco Steel Distribution Centre.
Under the Zisco acquisition deal, Essar paid government close to US$50 million and inherited the local steel maker’s debt estimated at US$340 million. Essar has also committed itself to clear US$22 million of Zisco’s salary-related arrears.
Essar, which is part of a large Indian conglomerate, is also reportedly planning to build a power station in the country to ensure electricity supplies for Zisco.