Portnex, Zimasco resolve differences

Portnex, Zimasco resolve differences

Source: Portnex, Zimasco resolve differences | The Herald March 15, 2017

Tinashe Makichi Business Reporter
South African firm, Portnex International and Zimasco have resolved their differences and are now working to improve operations at the ferrochrome miner, which is currently under judicial management.

Portnex International operates three of Zimasco’s furnaces under a five-year lease agreement valued at $12 million. However, the two companies were involved in public fights with Zimasco accusing Portnex of having failed to fulfil its obligations under a lease agreement which was signed in 2015 while the South African company felt cheated that they had not been told that the company was heading for judicial management.

“Following the well documented difficulties between the two companies during 2016, Zimasco and Portnex International have been working to resolve the various issues ever since the last few months of 2016.

“We are currently working amicably with no major issues arising during the course of normal business,” Zimasco general manager Clara Sadomba told The Herald Business yesterday.

Zimasco, a unit of China’s Sinosteel Corporation, was placed under provisional judicial management in July last year after its indebtedness to banks and creditors increased to about $65 million in 2015 from $38 million in 2009.

Resultantly the miner stopped operations in 2015 leading to the switching off of its furnaces at the Kwekwe refinery. Three of its furnaces were then leased to Portnex in a $12 million lease agreement signed last year.

A senior manager with Grant Thornton Grant Thornton and Camelsa who requested anonymity said the relations between the two companies has normalised and it was business as usual.

“Zimasco and Portnex are enjoying a perfect operational relationship at the moment. You know what happened in the past was generally the vagaries of the economy but the working relationship is fine and Zimasco as a whole is actually on a positive recovery path,” said the manager.

Zimasco expects to double its production and exports by the second quarter of this year as strategies implemented by the current judicial management begin to bear fruits.

The mining firm is producing and exporting on average 10 000 tonnes per annum of high grade chrome ore concentrates.

The company’s smelting infrastructure is running at 80 percent producing high carbon ferrochrome compared to the 37 percent production capacity recorded in 2015.

The ferrochrome miner last year secured an export licence to export around 240 000 tonnes per annum

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