Fairness Moyana, Business Correspondent
HWANGE Colliery Company Limited’s (HCCL) employees have approached the High Court in Bulawayo seeking to have the company placed under judicial management to save it from lawsuits.
Of late, 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.
Last month, some of the miner’s equipment was sold off to settle long standing debts.
Sources close to the developments told Business Chronicle that the employees’ leadership lodged their application with the High Court in Bulawayo this week in a bid to block further litigations and attachments of the colliery’s property by creditors.
Through their representatives, the workers argue that continued litigations and attachment of the colliery’s assets such as mining equipment threatened their jobs and scuttled the recapitalisation efforts of HCCL by the government.
Last year, the colliery closed 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.
“We understand that our leadership approached the High Court seeking to have HCCL placed under judicial management for fear that the company would be stripped of most of its core assets.
“What is happening now is threatening prospects of turning around the company hence our leaders’ move.
“We’ve been living in fear because of the number of litigations facing the company that have worked against the government’s efforts to resuscitate the ailing company,” said the source.
Despite procuring new mining machinery under the two transactions, HCCL was still struggling to raise productivity so that it is able to service its debt as well as pay the workers their outstanding salaries.
In 2015, HCCL was dragged to court over debts running into millions of dollars.
The company which was also embroiled in a protracted legal battle with some of its creditors, was recently forced to seek an out of court settlement after part of its mining equipment which included the only functional drilling machine was attached by the Messenger of Court.
Workers committee chairman Casper Ndlovu yesterday could not be drawn to comment on the matter saying he would do so in due course.
“I can’t at this moment confirm nor deny the development but something is happening. However, I’ll be able to comment in due course,” he said.
HCCL managing director Thomas Makore said he was not aware of the alleged application by the workers for the company to be placed under judicial management and promised to call back but had not done so by the time of going to print.
“I’ll check and get back to you I’m not aware of it (judicial management application),” he said.
The colliery’s indebtedness increased in 2009 when the country abandoned the Zimbabwe dollar to adopt a multi-currency system.
HCCL workers hope that if placed under judicial management, the firm would be able to properly service its debt.
Following the commissioning of its mining equipment in July last year, the colliery was expected to increase production from 200,000 tonnes of coal per month to 450,000 tonnes a month including output from the South African contractor, Mota- Engil.