ZimAlloys to pay creditors 70pc upwards on debt owed

GWERU-BASED ferrochrome producer Zimbabwe Alloys says it is working on an arrangement which will see creditors being paid upwards of 70 percent on debt owed to them before the company was placed under judicial management.

The former Anglo American Plc ferrochrome producer which stopped operations in 2008 was placed under provisional judicial management on July 24, 2014.

The company was then put under final judicial management in November the same year after its debt had risen to alarming levels.

It currently owes its creditors $60 million.

However, bad debt-buying company, Zimbabwe Asset Management Company last year agreed to take over $21 million worth of the group’s non-performing loans which are sitting with a number of local financial institutions in a bid to clean the company’s balance sheet.

In an interview with The Herald Business Judicial Manager Reggie Saruchera said the company is in the process of finalising with an Indian investor (which he refused to name citing the delicacy of negotiations) on a scheme of arrangement which will see the investor paying creditors their dues.

“In the next six weeks we will have finalised a scheme of arrangement where the Indian investor agrees with the creditors on how they are repaying and most of the creditors will be getting an upwards of 70 percent on the monies owed to them before the coming in of judicial management.

“Once that scheme of arrangement has been made the investor will come in and take control of the business.

“We think in the middle of September we should see the investor coming in to recapitalise ZimAlloys,” said Mr Saruchera

Midlands Provincial Affairs Minister Jayson Machaya is on record saying the revival of ZimAlloys would contribute significantly towards employment creation and help meet the $3 billion mineral export target.