Zimbabwe News and Internet Radio

ZimCoke demands compensation

By Michael Magoronga

ZimCoke Private Limited, whose deal with former steel giant, Ziscosteel, was terminated by the Government last year, is seeking compensation from the State for resources “wasted” during their three-year stay at the plant.

A blast furnace at Ziscosteel. — File picture
A blast furnace at Ziscosteel. — File picture

The company was set to take over a coke oven within the defunct Ziscosteel under a $255 million deal, which was viewed as the first step towards revitalisation of the steel giant. Government terminated the deal in September last year following a board recommendation.

The two companies had signed an agreement of sale in 2017 when ZimCoke bought the coke-making assets of Zisco consisting of the plant and machinery, land and buildings, and associated infrastructure of coal handling and wagons.

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The Government terminated the deal upon recommendation by the previous board led by Dr Gift Mugano, which advised that the ZimCoke deal was not done in “good faith”.

Addressing recent virtual Kwekwe Press Club briefing, ZimCoke consultant and prominent businessman, Mr Eddie Cross said shareholders were “disappointed” by the move and were now demanding compensation.

“The shareholders have now mounted a legal challenge to seek compensation for the three years of work that it put into the project. They are working on it and are likely to go to court,” said the outspoken former legislator.

Mr Cross said the company could be probably exporting coke by now had the deal materialized.

“It’s now nearly a year since the Zisco board suspended the deal and the Government did not support it,” he said.

“Had we been able to proceed with the project, it could have been up and running and we could be exporting coke today.”

Commenting on the revival of Ziscosteel, Mr Cross expressed optimism that the company can be revived using home grown solutions.

“If it is to make progress, it will have to be using a local consortium of business organisations, which will pull together resources to make the plant back up and running. I believe it is very possible that Zisco gets back on its feet again,” he said. The Chronicle