New Zimbabwe.com

BNC finalising takeover bids amid Tagwirei shadow

By Alois Vinga


AFRICA’s only integrated nickel mining company Bindura Nickel Corporation (BNC) is in the final stages of evaluating a takeover bids process which is set for finality in the next two weeks.

This comes amid reports that a firm linked to under-fire oil mogul Kudakwashe Tagwirei is set to acquire the mining giant.

Speaking to shareholders Thursday, BNC chairman Muchadeyi Masunda said the process is going on smoothly.

“Joint administrators are evaluating various bids that have been submitted while the prospective investors are carrying out due diligence in respect of the assets owned by ASA Resources,” he said.

ASA Resource Group, formerly known as ASA Mwana Africa Plc, acquired the majority shareholding in BNC from Anglo American Corporation Ltd and Freda Rebecca Gold Mine Ltd from Anglo Ashanti Gold in 2004.

ASA enjoyed about 75% and 85% of the issued shares of Bindura Nickel Corporation and Freda Rebecca Gold Mine respectively.

However, mismanagement of funds and illegal externalisation by the ASA Resource group prompted BNC debts to rise to over US$31 million.

The Chinese group has since made a decision to sell off its stake and exit the Zimbabwean market.

Despite the problems at hand, Masunda expressed optimism, maintaining that operations have not been affected.

The announcement coincided with a media report made early this month by a local business weekly saying Sotic International, a Mauritian company linked to business mogul Tagwireyi who has been associated with allegations of illegal deals and money laundering was in negotiations with Asa UK Plc’s joint administrators over the takeover of both Bindura Nickel Corporation and Freda Rebecca Gold Mine Pvt Limited.

ASA group, which is currently under administration in London with Duff and Phelps the appointed administrator, has been in negotiations with several investors regarding the acquisition of assets and liabilities, which, if successful, may have a material effect on BNC’s share price.

The company is under administration following the discovery of a misappropriation of funds and gross corporate governance breaches.

In the financial year ended March 31 2019, BNC realised a profit after tax of US$13,5 million, compared to the US$5,8 million recorded in the prior year.

The firm’s revenue had modestly grown by 1 percent to US$54 million from US$53,6 million in the comparable period last year.

During the period under review, operating profit jumped to $21,3 million which is 139,3 percent in the positive from $8,9 million realised in 2018, mainly attributable to exchange gains recognised on the introduction of the Zimbabwean dollar.