Wrangle over Zimbabwe diamond mine continues

Wrangle over Zimbabwe diamond mine continues
Published: 12 February 2019 (114 Views)
THE stalemate over the pricing of River Ranch Mine, situated in the border town of Beitbridge, continues unabated as the owners, Rani Investments, and potential buyers, the Zimbabwe Consolidated Diamond Company (ZCDC), have failed to agree on the price, NewsDay can reveal.

A once-lucrative mining venture, River Ranch was placed under liquidation in 2012 after Dubai-based Rani Investments, who are the major shareholders in Limpopo Mining Resources (Pvt) Limited (LMR), approached the courts seeking to officially wind-up the company due to viability challenges. Rani Investments holds 80% of LMR, while the other 20% is said to belong to the estate of the late army commander, Solomon Mujuru and former Zanu PF heavyweight, Tirivanhu Mudariki.

In an interview on Sunday, River Ranch liquidator Winsley Militala disclosed that the two parties were still far from agreeing on the selling price of the mine.

He said River Ranch's major shareholders had pegged the mine at $10 million, while ZCDC has offered $4 million as takeover price.

"I still have a deadlock that I have to try and work on unlocking. Rani Investments believes that the $4 million that ZCDC is offering is too low for the mine and for what is underground. They know what mineral is there and how much value that mineral has, and they are insisting that $10 million is the right price," Militala said.

He added that ZCDC had deployed more than four teams of its evaluators to visit the mine and carry out evaluations.

"Those guys have been there several times since we started this discussion. The evaluators are the ones that have given feedback to ZCDC on what they found out when they visited the mine. This is the information that should be able to guide the ZCDC accordingly in as far as arriving at its offer," Militala said.

On whether the $10 million that the shareholders were asking was justifiable given the period the mine was not operational, Militala said: "I sell the mine as it is. There is no way I can change things so as to make it accumulate value. If they continue offering that $4 million and the shareholders stick to their guns, then we have a bigger problem that requires us to sit down and have a discussion," he said.

River Ranch Mine, at its closure, was close to $22 million in the red, with the major shareholder in debt of more than $20 million.

ZCDC chief executive officer Morris Mpofu, in a recent interview, confirmed that there had been no movement in the negotiations and possible acquisition of the mine.

- newsday

Tags: Wrangle, MIne, Diamonds,
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