Online Reporter
Business Reporter
The High Court has scheduled the hearing for the RioZim Limited corporate rescue application for November 12 this year, according to a notice from the Registrar of the High Court.
The application, which seeks to avert the potential liquidation of the mining giant, was filed by RioZim workers on July 7.
The employees are represented by the Zimbabwe Diamond & Allied Minerals Workers Union (ZIDAMWU) and joined by two other employees from RioZim subsidiaries.
The workers argue that without urgent remedial measures, such as corporate rescue, the company faces “undesirable liquidation”.
Earlier this week, ZIDAMWU secretary general Mr Justice Chinhema wrote to the Registrar of the High Court requesting the expedition of the matter.
Mr Chinhema noted the court application was lodged nearly four months ago and pleaded for a hearing before the closure of the 2025 legal year.
“The delay in setting down the matter is causing prejudice and inconvenience to our trade union members, the investing public, and other affected persons,” wrote Mr Chinhema.
“We request that the matter be set for hearing as a matter of urgency before the conclusion of the legal calendar.”
Corporate rescue is a process aimed at reviving a financially distressed company.
The process provides a temporary moratorium on legal proceedings against the company, allowing a business rescue practitioner to develop and implement a plan to return the company to solvency.
Court documents reveal that RioZim, listed on the Zimbabwe Stock Exchange (ZSE), faces severe liquidity issues, with current liabilities exceeding current assets by approximately ZiG1,04 billion and total liabilities surpassing total assets by ZiG149,2 million as of June 30, 2024.
The company is struggling to meet financial obligations, including US$5,5 million and ZiG9 million in regulatory and contractual commitments.
This has led the Zimbabwe Revenue Authority to suspect financial impropriety and demand the company’s asset register. Critical services like electricity have been cut off at the Renco Mine due to a US$4,7 million debt.
Furthermore, RioZim owes US$5,6 million in outstanding salaries and faces numerous labor disputes.
Given the company’s negative equity of ZiG149,2 million and declining performance, including a drop in gold production despite global price increases, the situation is unsustainable and necessitates intervention to prevent collapse.
RioZim also faces significant legal challenges, including criminal charges from the tax authority and the Mining Industry Pension Fund, a US$30 million commercial dispute, and a US$55 million debt to an associate company.
