RioZim offloads Renco Mine

TAFADZWA CHINYANGANYA

Embattled resources group, RioZim Limited, has put Renco Mine up for sale for at least US$35m as it seeks to reduce debt, shore up liquidity and strengthen working capital, Business Times can report.

Renco, located about 80km south-east of Masvingo, is a wholly owned operating division of RioZim and has been in operation since the early 1980s.

The proposed disposal will include the mining lease, special grant, mining claims, land and buildings, plant and equipment, inventory, trade receivables and operational infrastructure, with the buyer also assuming about US$1.7m in specified liabilities.

An independent valuation puts the mining claims at US$6m, land and buildings at US$4.78m, plant and equipment at US$14.40m, inventory at US$4.38m and trade receivables at US$3.75m.

RioZim said Renco was operating under constrained conditions following years of limited capital investment, ageing infrastructure and obsolete processing equipment.

The mine requires about US$20m to rehabilitate underground infrastructure, refurbish the processing plant, improve mine development and restore the operation to sustainable production levels.

“Given the company’s current financial position and significant debt obligations, the board believes it is neither commercially prudent nor financially feasible for RioZim to undertake the required investment internally,” the company said.

RioZim did not name the potential buyer.

As at May 31, 2026, RioZim had a net current liability position of about US$51m, underscoring the financial pressure behind the proposed disposal.

RioZim plans to use US$25m of the proceeds to repay loans, US$5m to settle creditors and a further US$5m to stabilise its Cam & Motor operations.

The transaction would provide an immediate liquidity injection, although the full US$35m would not be available for discretionary investment or expansion.

The proposed sale comes shortly after Renco returned to production under a contract mining arrangement with Chinese contractor FeiFan Mining.

The mine produced 84kg of gold in the final quarter of the reported year and a further 92kg in the first quarter of 2026, making it RioZim’s principal source of gold production while other operations remained under development, rehabilitation or restructuring.

RioZim now intends to sell Renco as a cash-generating unit and going concern to an unrelated third party for not less than US$35m.

Renco has an established operating history and revenue-generating capacity, but requires substantial additional investment that RioZim says it cannot fund from its current balance sheet.

By selling the mine, RioZim would transfer the next phase of rehabilitation and development to a new owner while converting the asset into cash to address its immediate financial pressures.

The company’s directors said the disposal, together with available financing arrangements and its business plan, would provide adequate working capital for continuing operations.

The proposed transaction is subject to shareholder and regulatory approvals, with an extraordinary general meeting scheduled for October 20, 2026.

The sale also comes against the backdrop of legal challenges over RioZim’s financial position.

A corporate rescue application filed by the Zimbabwe Diamond and Allied Minerals Workers Union in April 2025 was dismissed by the High Court and subsequently the Supreme Court. A separate application filed by minority shareholder Tendai Rwodzi in April 2026 alleged that the company was in financial distress.

RioZim disputes the allegations and has said the pending litigation does not prevent the proposed disposal.