Sovereign ownership to determine stake value in foreign firms

of Youth Development, Indigenisation and Empowerment, Saviour Kasukuwere, yesterday during the official opening of the Zvishavane Community Share Ownership Trust training workshop in Darwendale.
He said Government should not be expected to pay for all the equity to be acquired under the indigenisation programme.
“The acquisition of the 51 percent indigenous shareholding shall take into account the principle of sovereign ownership of resources. Our laws are very clear in this regard.
“Consequently, Government should not be expected to pay for the acquisition of all this equity,” he said.
The remarks come as the Government recently reached an agreement with South Africa’s Impala Platinum over the disposal of 51 percent of its local subsidiary, Zimbabwe Platinum Holdings, to the NIEEB, the workers and the local community.
In terms of that deal, the Government agreed in principle to be “fully contributory for cash at independently determined fair value to be agreed” for the 31 percent of the shares that will go to the NIEEB.
At current market capitalisation, the 31 percent of Zimplats is valued at around US$350 million.
This means the calculation of the balance of 20 percent equity — in whole or in part — should take cognisance of the mineral ownership principle.
The Government, through the NIEEB, is in the process of setting up community                   share ownership schemes as part of the indigenisation programme.
It is through these community share ownership schemes that the Government is acquiring equity on behalf of respective communities.
“The indigenous people of Zimbabwe are the sovereign owners of their God-given resources hence have the right to free-hold of equity in indigenising companies.
“It is in line with this principle that communities as led by their chiefs in Community Share Ownership Trusts, are entitled to the 10 percent equity in mining businesses exploiting mineral resources on commercial lines.”
Meanwhile, the Zvishavane Community Share Ownership Scheme training workshop, which was organised by Mimosa Mining Company in conjunction with the indigenisation ministry and the Zimbabwe Institute of Public Administration and Management, is expected to accelerate the operationalisation of the Zvishavane Community Trust.