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SA group bids for stake in Zisco

Furnaces at the
Metallurgical Construction
Company of China
Johannesburg, South Africa — MININGREVIEW.COM — 23 July 2008 – The Reclamation Group of Companies – a South African recycling and waste management company consolidating 14 recycling businesses throughout South Africa and in Mozambique – is one of three companies reported to have made bids for a stake in the struggling Zimbabwe Iron & Steel Company (Zisco).

Quoting the Harare-based newspaper, “The Herald,” financial services provider I-Net Bridge reports from here that the Metallurgical Construction Company of China, Sunflag Iron & Steel Company of India, and the Reclamation Group of South Africa, have submitted bids for Zisco so far.

Although the tender for investors interested in partnering Zisco closed at the end of June, International Trade Minister Obert Mpofu said the Zimbabwean government was still accepting proposals from interested firms. The government, which is Zisco’s majority shareholder with a controlling 88% stake, has yet to say how much it is selling.

The state-controlled company has had a troubled past few years with perennial furnace breakdowns, debt arrears and corruption scandals hurting its prospects. Feeling the burden of serious financial constraints, Zisco “requires an investment of between US$100 (R800 million) and US$150 million (R1.2 billion)”, reports The Herald.

In early 2008, Zisco was said to be producing less than half its breakeven capacity of 25 000 tonnes a month.