DURATION Gold’s bid to list on the Toronto Stock Exchange (TSX) has run into a wall amid indications that government is not impressed with its empowerment plan.
Government sources told businessdigest this week that Indigenisation minister Saviour Kasukuwere is up in arms against Duration’s listing on the TSX.
According to sources, Kasukuwere feels that Duration could have listed on the Zimbabwe Stock Exchange due to the low amount the company is trying to raise on the TSX —US$7 million — for its Zimbabwe operations.
The source added that Kasukuwere wants an empowerment plan detailing how the company intends to empower black Zimbabweans in line with government’s economic empowerment regulations promulgated last year, compelling foreigners to sell controlling shareholding to locals.
This comes after Duration wrote a letter last month seeking the nod to list on the TSX by December 31 last year, but Kasukuwere has not given the company the green light yet.
“I received the letter, but I cannot comment on anything,” he said.
According to TSX’s website, Duration is not yet listed on the TSX, lending credence to suspicions Kasukuwere may have scuppered its listing plans for now.
“Kasukuwere is unhappy with a number of issues. These guys wrote to him last year seeking to list on the TSX but he has been sitting on it. I am told he wants them to list here (on the ZSE) on the basis that the funds they are trying to raise are too little to warrant a foreign listing. He is adamant in blocking the deal.”
The source added that Kasukuwere was also not happy with the company’s plan to hold on to about 30% of the US$7 million the mining firm intends to raise in Toronto for head office expenses.
Kasukuwere refused to comment on whether he had blocked the listing.
After the gazetting of economic regulations last March, Kasukuwere now has the authority to approve and disapprove deals involving foreign equity participation.
Last year, Kasukuwere also attempted to block the sale of a Barclays Bank subsidiary, Custodial Financial Service, on grounds that the bank did not comply with indigenisation and economic empowerment regulations. This comes after Barclays Bank plc, the local bank’s parent company, agreed to sell its custody business in Africa to Standard Chartered.
Efforts to reach Duration chairman Allan Dolan proved fruitless as his mobile phone went unanswered.
Duration in September last year denied having immediate plans to list on the TSX.
Dolan said then: “We are a private company and we want to grow the company to a certain size before we would consider that. There are no imminent plans to list, but the prospect is certainly part of our long term plans after consultation with our board and professional advisors.
Dolan also said in September that his company would consider a local listing.
“We fully endorse local investment and listings. Again, the public markets are the most transparent, fair, efficient and effective method of ensuring broad-based public enjoyment of Zimbabwe’s mineral wealth,” he said.