TROUBLED Zimbabwe Stock Exchange-listed Hwange Colliery Company Limited (HCCL) will by the end of next week have a new-look board of directors, Mines minister Winston Chitando has said.
By Nkululeko Sibanda
The new board comes as Chitando is making changes to a host of other boards that fall under his ministry.
Government is the largest single shareholding in the company, while businessman Nicholas van Hoogstraten also holds a significant stake in the mining concern.
In an interview with businessdigest this week, Chitando revealed his office would make new board appointments in all the parastatals within his purview. Parastatals such as the Zimbabwe Consolidated Diamond Company, the Minerals Marketing Company of Zimbabwe, the Zimbabwe Mining Development Company and HCCL, will all have new boards, he said.
“By the end of next week, I shall announce new board appointments at the companies I have referred to. These are appointments where we will move some people within parastatals, drop others, and bring in new faces at the same time. Hwange Colliery Company Limited will also have a new board,” Chitando said.
He added that for HCCL, the appointments came at a time when government was convinced the company was on its way to recovery. “We will have new people coming into these boards and, as for Hwange, the announcement comes at a time when the company is in the process of implementing a strategic document that will see it (HCCL) getting into a phase of positive cash generation. We have been informed that whilst there will be no cash injection for Hwange at the moment, the company will be able to generate cash from the sale of coking coal which we understand is on demand,” Chitando said.
“In the short term, we are advised that the company will be able to produce about 50 000 tonnes of coking coal whose revenues will come in handy in aiding the operations of HCCL. In the medium term, Hwange, we are advised, will be able to open the second underground section of the mine. This is likely to happen in the next 18 months and we have engaged with one or two people who are keen to release funding for this new development.”
Chitando, a former non-executive chairperson at HCCL, also said that the coalminer was in the process of re-opening its coke works section that has not been operating for years. “We tendered the rehabilitation of the coke works some time ago. We are now at the stage of adjudicating for the winner of that tender. Once that is up and running, we expect that side to also become a revenue stream for Hwange,” Chitando said.
Recently, Hwange announced it would sell off some of its real estate assets. The property includes houses that accommodated former and current employees.
Chitando said the move was aimed at curbing expenses to ensure that HCCL remained with reasonable and manageable costs. “All we want is to ensure that Hwange is back on a sound footing. We have paid for equipment that should be used in underground mining operations and once the operations start in August, things should improve at Hwange,” Chitando said.
The announcement comes as sweet news to the ears of shareholders who indicated to businessdigest this week there was need for government, as a major shareholder, to dissolve the current board following allegations of incompetence and maladministration.
Shareholders who spoke to businessdigest said it was high time government dissolved the entire board and appointed new people who would drive the colliery out of its doldrums. “We appreciate that a step has been taken insofar as trying to arrest the rundown of affairs at the company. Our belief is that this is not the answer, entirely, to the problems that the company finds itself in,” one shareholder said.
“As part of the shareholders, our push now will be to have government dissolve the whole board because it was complicit in the mismanagement of Hwange affairs.”
The shareholder said the company’s board had slept behind the wheel.
“It is easy for the board to jump now and suspend the managing director (Thomas Makore). The truth of the matter is that they slept behind the wheel and allowed the situation to collapse under their watch.”