RioZim clears key hurdle

TAFADZWA CHINYANGANYA

Embattled RioZim Limited shareholders have unanimously approved the proposed sale of Renco Mine for at least US$35m, clearing a key hurdle in the gold producer’s efforts to shore up its balance sheet, settle creditors and revive struggling operations.

The company is expected to channel US$25m towards loan repayments, US$5m to creditors and the remaining US$5m into Cam & Motor operations, as the group seeks to restore production after years of undercapitalisation and operational challenges.

The approval was granted at a recent extraordinary general meeting, where shareholders backed a special resolution authorising the sale of Renco Mine as a going concern to an unrelated third-party buyer, subject to regulatory approvals and compliance with Zimbabwe’s corporate and stock exchange requirements.

RioZim company secretary Allan Murimirwa said the resolution authorised the disposal of the mine, including its associated assets and operational infrastructure, for a minimum consideration of US$35m.

The transaction covers the Renco mining lease, special grant, associated mining claims, land and buildings, plant, machinery and equipment, as well as infrastructure required to sustain operations. Specified liabilities will also be assumed by the purchaser in terms of the sale agreement.

All votes cast at the meeting supported the resolution, with no votes against or abstentions, signalling unanimous shareholder backing for the proposed asset disposal.

The resolution also empowers the board to execute the necessary agreements, secure regulatory approvals and complete the registrations and transfers required to implement the transaction.

However, the sale is not yet complete, with the parties still required to satisfy the applicable conditions and obtain the necessary approvals. RioZim has not disclosed the identity of the prospective buyer in its shareholder-resolution notice.

The minimum US$35m consideration represents the floor for the proposed disposal, rather than confirmation of a final agreed price or proceeds already received.

The transaction comes as RioZim seeks to stabilise its finances and rebuild operational capacity following a difficult 2025 financial year, during which gold production fell sharply amid prolonged operational disruptions and funding constraints.

Chairman Caleb Dengu has said the group is focused on unlocking value from its diversified asset portfolio while addressing its funding and recapitalisation requirements.

RioZim received US$15m in advances from Feifan by the end of 2025 to support the resuscitation of its operations, according to its annual report.

The proposed Renco disposal could provide fresh liquidity to ease debt pressures and support the group’s remaining operations, although the extent of any recovery will depend on the completion of the transaction and the terms ultimately agreed.

Cam & Motor, one of the group’s key gold-producing assets, has been the focus of efforts to restore production following the dewatering of flooded pits. The planned allocation of US$5 million from the Renco proceeds would provide additional funding for these operations.

RioZim is a diversified mining and metallurgical group with interests in gold, diamonds, coal, nickel, copper and platinum group metals. Its gold portfolio includes Renco, Cam & Motor and Dalny mines.

For investors, the proposed sale marks a significant step in RioZim’s restructuring efforts, but execution will be critical. The transaction’s ultimate value will depend on regulatory clearance, the final sale terms and the extent to which the proceeds translate into lower debt, improved liquidity and a sustainable recovery in production.