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Last week, the Government was locked in a series of meetings with Essar Africa Holdings, the owners of New Zimsteel, following the impasse over the company shares.
The standoff has stalled the resuscitation of the Redcliff-based giant steel making company one year after President Mugabe commissioned the $750 million investment deal with the Indian-owned Essar Africa Holdings.
Industry and Commerce Minister Professor Welshman Ncube on Tuesday said the deliberations had been completed and were awaiting Cabinet approval.
“We were supposed to present a report to Cabinet today on the outcome of the discussions we held last week. As you are aware that the President is not around the meeting did not take place,” said Prof Ncube.
“We will table the report in our next Cabinet meeting next week Tuesday. We cannot announce the outcome of the meeting to you now. We first have to get Cabinet approval and then we will announce the outcome to the media.”
Essar Holdings is a majority shareholder of the New Zimsteel (Pvt) Ltd with about 60 percent controlling stake while Government only owns 40 percent.
The Government also has 20 percent stake in NewZim Minerals (Pvt) Ltd formerly Buchwa Iron Mining Company (Bimco) while Essar Holdings owns 80 percent.
The Government, however, has said the company’s share structure was not in tandem with the country’s indigenisation laws which stipulate that foreigners should not own more than 49 percent shares in companies.
The development reportedly prompted New Zimsteel management to suspend paying salaries to its more than 1 500 workforce in May this year in a bid to press Government to finalise the takeover agreement.
Senior company officials are said to be reluctant to continue pumping more money into New Zimsteel which is yet to iron out mining rights from Government.
At some point Prof Ncube and his Mines and Mining Development counterpart Dr Obert Mpofu traded accusations over delays in the resumption of operations at the steel company.
This prompted the Industry and Commerce Parliamentary Portfolio Committee to summon the two ministers to appear before it in May to explain what was stopping Essar Holdings from commencing operations.
The committee expressed concern over delays in resuming operations at New Zimsteel, saying the development was a betrayal of President Mugabe and the people of Zimbabwe.
The commissioning of the new steel making company, formerly Zisco, rekindled hopes of the revival of the dormant giant steel plant which has been idle since 2008 when it stopped production.
Once operational, New Zimsteel is set to breathe life back into the surrounding communities of Redcliff, Kwekwe and Gweru.
The new company was expected to create more than 5 000 in direct employment at both Redcliff and Chivhu projects.
Essar Holdings committed itself to retaining the defunct Zisco’s 3 500 workers.
Online Reporter