A showdown is looming at Metallon Gold Zimbabwe after employees rejected latest advances by an investor and opt to pursue a business rescue plan.
Business Times is reliably informed that Metallon employees who are owed millions in salary arrears were irked by the investor’s offer of clearing the arrears at 1:8.
Employees are rejecting this offer as peanuts.
It is understood that the investment vehicle has already fulfilled payments to Mzi Khumalo in foreign currency culminating in the takeover of Shamva, Mazowe, and Redwing mines-despite the awarding of a rescue plan for the mining group by the High Court.
The mining group Metallon has four mines under its portfolio namely, How Mine, Mazowe, Shamva and Redwing mines while Arcturus Mine was sold to businessman Tawanda Nyambirai.
Metallon Corporation legal representative George Gapu of Scanlen and Holderness said: “There are discussions currently happening to settle the matter amicably and out of court.”
Employees have also been riled by the fact that the investor went on to make payments to Metallon owner Khumalo before taking into consideration, the concerns of the wideranging creditor’s constituency.
It is understood that the newly appointed judicial manager Reggie Saruchera of Grant Thornton Zimbabwe is also not happy by the arrangement made between the investor and the gold miner’s shareholders.
Khumalo did not respond to requests sent to him while Tagwireyi also did not respond by the time of going to print.
A well-placed to the development said employees are pushing for settlement of their salary arrears on 1:1 exchange rate.
“We are pushing for 1:1 but it is unfortunate that the investor is offering peanuts.
To further worsen the situation, the investor went on to pay shareholders for the mining assets bypassing creditors.
“This was a suspicious arrangement,” said the source.
The High Court recently placed Metallon’ Mazowe and Shamva mines under administration after granting an application by Associated Mine Workers Union of Zimbabwe for a reconstruction order of the two mines.
Metallon however, recently appealed at the Supreme Court against the High Court ruling which placed the miner under administration.
The gold miner has been facing challenges after hitting a new low amid revelations the gold mining group has been suffering neglect from Khumalo, a situation that is affecting productivity at the gold mining group culminating to multiple job losses at the group’s two Mashonaland Centralbased units.
The current standing of the company has seen a huge management turnover which also saw former chief executive Kenneth Mekani leaving the company.
The gold mining group has also been battling allegations of externalising over US$30m through dividends paid to shareholders without profits to back them and fictitious external loan payments.