By Oliver Kazunga
The government has directed Hwange Colliery Company Limited (HCCL) to negotiate with its creditors for payment plans to ensure the firm is not placed under judicial management.
Last month, more than 2,500 HCCL employees filed an urgent chamber application at the High Court in Bulawayo seeking to have the company placed under judicial management.
The workers, who for the past 30 months have not been paid their salaries, highlighted that no interested party would suffer any conceivable prejudice in the event that HCCL is placed under judicial management.
They are also of the view the placement of the colliery under judicial management would see the firm being able to properly service its debts.
HCCL, which is facing litigation for claims amounting to about $20,6 million from some of its creditors including ex-workers, has seen some of its assets auctioned to recover the debts.
Responding to questions in Parliament on Wednesday, Mines and Mining Development Deputy Minister Fred Moyo said the payment plans would give the company a chance for resuscitation.
HCCL has a legacy debt of about $160 million.
“What we’re trying to do is to avoid the company from going into judicial management or liquidation. We want to bring all creditors together, discuss with them, agree on how shareholders can protect them, allow them to have payment plans put in place and then give the company the chance to raise capital, which will not be intercepted by creditors and therefore try and resuscitate the company,” said Deputy Minister Moyo.
“So, all creditors will be looked at. In any case, the law expects workers to be at the top of the creditor priority list.”
The Deputy Minister said HCCL management had been instructed to put specific arrangements that will give some level of comfort to the workers.
“Management has been instructed to put a specific arrangement that will give some level of comfort to employees on an ongoing basis whilst we’re managing the larger part of the employee risk. That is the position that is in place,” he said.
In 2015, the colliery concluded two capitalisation transactions, which were vendor-financed through the PTA BELAZ facility to the tune of $18,2 million and the India Exim Bank’s $13,03 million BEML facility.
However, despite the transactions which saw Vice President Phelekezela Mphoko commissioning the machinery on July 17, the colliery was yet to improve production to desired levels.
Equipped with the machinery, it was hoped that HCCL would raise productivity from 200,000 tonnes of coal per month to 450,000 tonnes a month including output from the South African contractor, Mota- Engil.
The new machinery from the two transactions include 10 dump trucks, five front-end loaders, two wheel dozers, two excavators, two water bowsers, three front-end loaders, three bulldozers, three drill rigs, a motor grader and one tyre handler. The Chronicle
