Online Reporter
Business Reporter
A labour body has rejected a US$160 000 settlement offer from RioZim Limited to withdraw its application seeking to place the listed diversified resources company under corporate rescue.
The Zimbabwe Diamond and Allied Minerals Workers Union, which is owed by RioZim, deemed the offer insufficient as it lacked guarantees for broader employee and corporate welfare.
RioZim, which is facing a financial crisis, has not been remitting subscriptions due to the mining employees’ representative body, which affirms the union’s claim that the company requires rescue proceedings.
The application for corporate rescue was lodged by some of the company’s workers, represented by ZDAMWU.
The union argues that RioZim is facing severe operational and financial challenges and that the corporate rescue is the only mechanism that could save it from collapse.
The development comes after RioZim chief executive Mr Rajgopal Swami publicly urged ZIDAMWU to cease creating “hurdles” to the company’s revival, arguing the corporate rescue application was hindering recapitalisation efforts and delaying the process of settling employee arrears.
Mr Swami maintained that a successful turnaround was “definitely possible,” asserting the company was “at the cusp of a breakthrough.”
He also emphasised that the company’s future hinged on unity and a shared commitment to long-term recovery among all stakeholders.
RioZim, through its lawyers Nyahuma’s Law, made the offer “completely without prejudice” and contingent upon ZIDAMWU making an “unequivocal undertaking” to abandon all legal cases related to the corporate rescue bid.
Furthermore, the offer required the union to consent to RioZim’s application for leave to appeal a High Court judgment that stopped the company from freely dealing with its assets.
The settlement offer also demanded that ZIDAMWU should desist from “tarnishing its image.”
“The tender is made on condition that prior to the release of the funds, you make an unequivocal undertaking to withdraw and abandon all its (court) cases and relative to the placement of our client under corporate rescue,” RioZim said.
