HARARE, January 16 (The Source) – Moribund steelmaker, Ziscosteel on Tuesday announced that it will be seeking approval from its minority shareholders to allow Government to assume its debt estimated at $450 million, and its takeover by Hong Kong firm, Tian Li.
Tian Li, which is incorporated in the Caymen Islands tax haven, is a subsidiary of R&F Properties , which last August agreed to invest up to $2 billion in the steelmaker.
It is an investment holding company, which manufactures, sells, and trades in multi-layer ceramic chips (MLCC) in Mainland China and internationally. It also trades in commodities, such as metals, minerals, and petroleum products.
Tian Li was listed on Standard and Poor’s Global BMI Index until last September. It was bought by R&F in 2007, according to a notice on the Hong Kong Stock Exchange.
On August 28 last year, industry minister Mike Bimha told journalists that a deal with R&F was imminent, with production expected to resume within 18 months.
The minority shareholders are expected to give up their shares and preemptive rights in Ziscosteel. Government holds an 89 percent stake in Ziscosteel but it is unclear who the minority shareholders are.
According to a circular to shareholders published on Tuesday, the deal will make way for the sale of the company’s “corporeal and incorporeal” assets to Tian Li while some assets have been tagged for sale to ZimCoke.
In 2011, the African unit of India’s Essar group agreed to buy Zisco for $750 million but the deal collapsed as the partners could not agree on how the company’s debts would be resolved and ownership of the mineral claims.
Before its collapse in 2008, Ziscosteel was Africa’s biggest integrated steel manufacturer exporting to Europe and Asia as well as other African countries.
A 2014 study by the Zimbabwe Economic Policy Analysis and Research Unit (Zeparu), stated that Zimbabwe lost over $20 billion in potential revenue as a result of Ziscosteel’s collapse.
Editors Note: In the story “undefined” sent at: 16/01/2018 16:03
This is a corrected repeat.