Govt seeks new in­vestor for Zis­cos­teel

Chronicle (Zimbabwe) - - Business Chronicle - Oliver Kazunga

THE Gov­ern­ment is in a fresh hunt for po­ten­tial in­vestors to re­vive op­er­a­tions at the de­funct steel pro­ducer, Zis­cos­teel fol­low­ing the col­lapse of the $750 mil­lion Es­sar Global deal signed in 2011.

Zisco ceased op­er­a­tions in 2008 due to fi­nan­cial con­straints and its re­open­ing has in re­cent years had many false starts.

Re­spond­ing to ques­tions in Par­lia­ment on Wed­nes­day, In­dus­try and Com­merce Deputy Min­is­ter Mrs Chi­ratidzo Mabuwa said the Gov­ern­ment through her min­istry was in the process of iden­ti­fy­ing an in­vestor to re­sus­ci­tate Zisco.

“In­vi­ta­tion of ex­pres­sions of in­ter­est were sent to 29 po­ten­tial in­vestors and six re­sponses were re­ceived by the clos­ing date of Oc­to­ber 4, 2016.

“Th­ese po­ten­tial in­vestors in­clude both lo­cal and for­eign in­vestors from coun­tries such as South Africa, In­dia and China.

“My min­istry is now work­ing on car­ry­ing out the due dili­gence ex­er­cises for th­ese po­ten­tial in­vestors that have ex­pressed their in­ter­est.

“The min­istry is ex­pect­ing to fi­nalise the iden­ti­fi­ca­tion of an in­vestor to re­sus­ci­tate Zisco by the end of 2016 ac­cord­ing to the Zisco 100 Day Plan,” she said.

e Speaker of Par­lia­ment Ad­vo­cate Ja­cob Mu­denda is on record say­ing for­mer In­dus­try and Com­merce Min­is­ter Welsh­man Ncube “mis­led” the in­clu­sive Gov­ern­ment into sign­ing the $750 mil­lion Es­sar/Zisco deal with­out do­ing due dili­gence on the ca­pac­ity of the in­vestor.

Un­der the ar­range­ment, the In­dian con­glom­er­ate, Es­sar was ex­pected to take over Zisco’s for­eign debt, which amounted to $300 mil­lion and part of lo­cal li­a­bil­i­ties.

The in­vestor had also in­di­cated the in­tent to in­vest about $4 bil­lion within four years of re­sum­ing op­er­a­tions at the Red­cliff-based steel plant as well as set­ting up a 600 megawatt ther­mal power plant to sup­port steel­works.

How­ever, the Gov­ern­ment ad­mit­ted the col­lapse of the Es­sar deal in Novem­ber last year after the in­vestor de­vel­oped cold feet four years after sign­ing what was per­ceived as an in­vest­ment mile­stone.

The re­vival of Zis­cos­teel is strate­gic in the eco­nomic turn­around of the coun­try.

Once the largest steel man­u­fac­tur­ing firm north of Lim­popo, Zisco em­ployed over 3 500 peo­ple at its peak. — @okazunga.

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