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Business Reporter
shabanie Mashava Mines could soon resume operations as Government is working on a financial plan to support a refurbishment exercise for the company.
Mines and Mining Development Minister Walter Chidhakwa in an interview last week said his ministry had asked Treasury for funding to support the initiative, but he would not say how much would be required for the exercise.
Minister Chidhakwa said Government had already put together a plan for refurbishment of the company’s equipment and machinery but funding was the problem.
“Government has worked out a plan for the refurbishment (of the company), but the problem is that of funding and we are discussing with the Ministry of Finance.
“We have asked Treasury to try and provide resources to support all companies under the Zimbabwe Mining Development Corporation so that we can resuscitate operations. We have to provide resources in the budget,” he said.
SMM was put under the control of the Ministry of Mines and Mining Development after a Government-appointed administrator failed to bring the firm to viability since it stopped operations in 2008 due to mounting funding constraints.
SMM had been placed under the control of an administrator, Mr Afaras Gwaradzimba, in September 2004 in terms of the Reconstruction of State Indebted Companies Act after the company ran into serious financial problems.
The asbestos miner was put under reconstruction following allegations that Mr Mawere had externalised huge sums of money generated from exports of asbestos.
Further, it was alleged that he had not recapitalised the firm as pledged.
Mr Mawere has, however, denied all the allegations levelled against him and is fighting to repossess SMM and other firms that fell under African Resources Limited.
But the reconstruction efforts under the administrator failed to yield results as problems continued to mount while attempts to lure an investor also faltered.
Mr Mawere accuses the Government of trying to expropriate his assets.
The company, SMM Holdings Private Limited was the owner of the two asbestos mines located in Mashava and the mining town of Zvishavane and was also the holder of shares in various other cross sectoral companies in Zimbabwe.
SMM was a wholly-owned subsidiary of SMM Holdings Limited, a company registered in the United Kingdom.
In March 1996, Africa Resources Limited concluded an agreement with T and N Plc for the purchase of the shares the latter held in SMM Holdings and another UK subsidiary company, THZ Holdings Limited.
The right of T&N in SMMH and THZH were passed on to ARL.
A scheme was then put in place after placing SMM under reconstruction for a nominee company, AMG Global Nominees to be used for the purpose of purchasing the security interests held by T and N against ARL in respect of shares in SMMH and THZH pursuant to the Sale and Purchase Agreement of 1996.
Acting on the basis that ARL had defaulted on its obligations to T&N, AMG paid US$2 million in respect of the title, interest and rights held by T&N in the bearer share warrants provided to T&N by ARL by way of security.
AMG then approached the UK courts for an order to rectify the member (shareholder) register of THZH and SMMH.
The application was dismissed with costs.
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