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Munyaradzi Musiiwa, Midlands Correspondent
A NUMBER of investors have shown interest in taking over operations of Ziscosteel in the wake of the collapse of the Essar Deal, Industry and Commerce Minister Mike Bimha has said.
In an interview on the sidelines of a visit to Sable Chemical Industries in Kwekwe on Friday, Minister Bimha said there were investors who have shown interests in Zisco and are willing to take over the operations of once the region’s giant iron and steel manufacturer.
Minister Bimha’s remarks came in the wake of Finance Minister Patrick Chinamasa announcing that the company will offload over 1 000 workers following the collapse of the Essar deal. The company also owes the workers about $ 200 million in salary arrears. It is understood that Essar Africa Holdings Limited failed to revive Zisco since 2011.
Minister Bimha reiterated that the Reserve Bank of Zimbabwe will take over the company’s liabilities so that Ziscosteel becomes attractive to any suitors who may want to invest in the company.
“The Zisco board and management have been working on a programme to ensure that there is full utilisation of human resources until such time that Zisco gets back on stream. We might still use the same workforce and people. We are very much aware of their outstanding salaries. There have always been many investors interested in Zisco. There are so many aspiring investors as far as the steel production in concerned,” he said.
“There have always been many investors who have expressed interest in joining Government in operating Zisco steel. What has been a sticking issue was the issue of debt. The Government taking over the debt will enable us to continue negotiations with other potential investors.”
Minister Bimha, however, could not reveal potential investors who have shown interest in the Kwekwe based iron and steel manufacturer in fear of jeopardising the negotiations.
The Government rekindled hope for the revival of once the biggest integrated steelworks in Africa when it sold 54 percent of its shares to Essar in a $750 million deal which included taking over Zisco’s debts and liabilities.
Ziscosteel had seized operation in 2008 as it choked under a $340 million debt and other viability problems and Essar Holdings came to its rescue.
The Essar deal was expected to bring back life to Redcliff while at the same time uplifting the wellbeing of over 3 500 workers.
But a year after the signing of the deal, hopes which had been rekindled are slowly fading.
Under the deal Essar Holdings were to invest over $4 billion over the next four years at New Zim Steel, including setting up a 600MW thermal power plant to support the steelworks. The Government-Essar deal had brought light to ailing industries in the Midlands Province who have since downscaled production due to liquidity challenges.
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