(TALKZIMBABWE) New Dawn Mining, CAG merger threatens our security - Govt
New Dawn Mining, CAG merger threatens our security: GovtBy: Our reporter
Posted: Friday, June 25, 2010 6:03 pm
THE inclusive Government of Zimbabwe has expressed concern at the purported acquisition by New Dawn Mining Corporation of an 89% controlling share of Central African Gold, as the transaction has taken place offshore and without reference to the company's indigenisation and mining laws.
In a statement issued by the Minister of State for Presidential Affairs, Didymus Mutasa, government expressed "grave concern" with the deal.
New Dawn is listed on the Toronto Stock Exchange (TSX) and the Frankfurt Stock Exchange, while CAG is quoted on the Alternative Investment Market (AIM), which is the London Stock Exchange's international market for smaller growing companies.
In the statement, emailed to the Zimbabwe Guardian on Thursday, Minister Mutasa said "Government is particularly concerned by the fact that it only learnt of this transaction of through the local press."
CAG's major shareholders are also non-Zimbabwean and include Emerging Capital Partners (ECP) Africa Fund, HBD Zim Investments Limited and Investec Asset Management Limited.
"It is manifestly wrong and indefensible for foreigners to play casino with Zimbabwe's assets in this way, whichever way one chooses to look at this transaction, be it political, legal, economic or social," read the statement.
Minister Mutasa said that CAG acquired its controlling share in Falcon and Olympus Mines on 1st March 2007, through a similar offshore share swap transaction. With that, it took ownership of Dalny Mine, Golden Quarry Mine, Venice Mine, Camperdown Mine, Old Nic Mine and other significant additional geologically prospective ground holdings in various parts of Zimbabwe, all attributable 100% to Falgold and Olympus.
These two mining houses, together, constitute the second largest gold mining group in Zimbabwe after Metallon Gold. This makes any transactions involving them strategic and of major national security interest.
"In 2008, CAG decided to shut down operations and place all of the above mines, except Old Nic Mine, under care and maintenance in protest at what it termed a 'hostile fiscal and policy environment'," read the statement.
"CAG leveraged the 2007 acquisitions to raise substantial finances through equity and loans, but went on to invest this money in Ghana where it claims to have lost all of it, while the Zimbabwe assets lay in disuse.
"With the benefit of hindsight, however, it is now clear to Government and all well-meaning stakeholders that CAG never intended to mine a single ounce of gold in Zimbabwe because, by the mere acquisition of these assets, it was able to continue to keep a decent balance sheet through various offshore listings."
According to the minister, this enabled CAG to keep the Zimbabwe assets under care and maintenance for prolonged periods, for speculative negative political ends and "as a result of this deliberate policy, of all the CAG mines in Zimbabwe, only Old
Nic and Dalny are currently producing, after Dalny resumed operations at bare minimum capacity 2009."
"Government cannot, therefore, continue to countenance these kinds of transactions (which do not involve) any local involvement, particularly as the Western sanctions persist."
According to Minister Mutasa, this is "a direct threat to Zimbabwe's sovereignty and national security. No country in the world allows outsiders to play such casino games with its natural resources."
"Government, therefore, will subject this deal to rigorous collaborative scrutiny by Cabinet, the Ministry of Indigenisation & Youth Empowerment, the Ministry of Mines and Mining Development, the Ministry of State Security, the Parliament of Zimbabwe, the Zimbabwe Investment Centre, the Competition and Tariffs Commission, the Securities Exchange Commission and other
relevant Government and regulatory authorities, in order to ensure its conformity with Zimbabwe's immediate national security needs.
"This notwithstanding, Government will also follow with keen interest and encourage any engagements that seek to build honest business partnerships in the interest of indigenisation, international best practice and Zimbabwe's national security."
Labels: CAG, DIDYMUS MUTASA, NEW DAWN MINING
posted by MrK @ 8:52 PM
0 Comments:
Post a Comment
Subscribe to Post Comments [Atom]
<< Home