METALLON Gold (Metallon)’s controversial plan to buy back Manyame Consortium (Manyame)’s 30% share in the group took a new turn this week on information that company owner Mzi Khumalo
offered the Zimbabwean investors US$3 million for a return of the stake.
Khumalo, reportedly doing so to fulfill his long-intended listing scheme of the five-mine gold group since his bargain takeover three years ago, made the payoff enticement after the consortium had courted him to raise US$1,3 million to pay off debts related to the initial equity-financing process.
The collapsed Barbican Bank, principally owned by Mthuli Ncube and one of the Manyame directors, had funded the empowerment grouping to the tune of US$1 million, a loan which had accrued a US$300 000 interest.
Manyame needed the money to secure the investment and make a mandatory deposit of US$9 million asking price for the stake.
Khumalo, sources said, pounced on the help-plea by Manyame and told its promoters that he favoured buying them out completely as opposed to aiding them raise the much-needed foreign cash.
Through his internal counsel, Nambita Mazwi, the Durban-based tycoon reportedly drafted a buy-back agreement in late 2003, which yielded no results.
Mazwi on Wednesday declined comment on the matter, while Metallon corporate affairs manager, Nonqkubela Maliza, said they had a business arrangement with the empowerment grouping and “were in constant negotiations with Manyame”.
“As Metallon, we wish not to talk about that,” Maliza said, having earlier said she would neither confirm nor deny the buy-out inducement.
But, said a source: “Upon realising that Manyame was less enthusiastic (on the deal), Khumalo wrote a follow-up paper to replace the one that had expired at the end of its three-month expiry period.
“The newer draft, largely driven by him and his team, also had a restraint period which expired on January 31 this year. Again, nothing came out of it as Manyame feared the repercussions.”
John Mkushi, Manyame’s chairman, also said he was not at liberty to discuss the shareholding saga.
The South African company, which is majority-owned by Khumalo, is eyeing a R350 million flotation on the JSE Securities Exchange preferably before the end of April.
However, the unraveling of its intended buyout of local shareholders and partners is likely to blur its listing plans, both in Harare and South Africa.
The proposal was also curious in that Khumalo wanted to pay Zimbabwean investors about a third of the Metallon stake’s worth, yet the initial US$9 million valuation — when Manyame bought into the gold producer — was his.
Metallon, owning Arcturus, How, Mazowe, Redwing and Shamva mines, produces 195 000 ounces of gold yearly and it is Zimbabwe’s largest bullion producer.
Khumalo argues a public offering would unlock or release R200 million, which would see further expansion of the mines and other group activities.