Zimpapers Logo

Zisco Steel

Oliver Kazunga, Senior Business Reporter
THE Government is in a fresh hunt for potential investors to revive operations at the defunct steel producer, Ziscosteel following the collapse of the $750 million Essar Global deal signed in 2011.

Zisco ceased operations in 2008 due to financial constraints and its reopening has in recent years had many false starts.

Responding to questions in Parliament on Wednesday, Industry and Commerce Deputy Minister Mrs Chiratidzo Mabuwa said the Government through her ministry was in the process of identifying an investor to resuscitate Zisco.

“Invitation of expressions of interest were sent to 29 potential investors and six responses were received by the closing date of October 4, 2016.

“These potential investors include both local and foreign investors from countries such as South Africa, India and China.

“My ministry is now working on carrying out the due diligence exercises for these potential investors that have expressed their interest.

“The ministry is expecting to finalise the identification of an investor to resuscitate Zisco by the end of 2016 according to the Zisco 100 Day Plan,” she said.

The Speaker of Parliament Advocate Jacob Mudenda is on record saying former Industry and Commerce Minister Welshman Ncube “misled” the inclusive Government into signing the $750 million Essar/Zisco deal without doing due diligence on the capacity of the investor.

Under the arrangement, the Indian conglomerate, Essar was expected to take over Zisco’s foreign debt, which amounted to $300 million and part of local liabilities.

The investor had also indicated the intent to invest about $4 billion within four years of resuming operations at the Redcliff-based steel plant as well as setting up a 600 megawatt thermal power plant to support steelworks.

However, the Government admitted the collapse of the Essar deal in November last year after the investor developed cold feet four years after signing what was perceived as an investment milestone.

The revival of Ziscosteel is strategic in the economic turnaround of the country.

Once the largest steel manufacturing firm north of Limpopo, Zisco employed over 3 500 people at its peak.

@okazunga.