RioZim Limited has secured shareholder approval for a wide-ranging restructuring plan centred on asset disposals, debt reduction, and a proposed US$35 million loan facility, as the miner moves to stabilise its finances and revive operations, Mining Zimbabwe can report.
By Ryan Chigoche
The approvals, confirmed in a company statement after all six resolutions were adopted with full shareholder support, give management the mandate to unlock value from selected assets while addressing a debt burden estimated at US$76.5 million, according to prior disclosures on the Zimbabwe Stock Exchange.
A key component of the plan is a debt-for-asset transaction involving RZM Murowa (Private) Limited, a major shareholder. The arrangement will see RioZim dispose of its 22.2% stake in Murowa Diamonds, together with four diamond mining claims, ML 26, Sese, Shavahuru, and Bubi, valued at US$4.6 million, in exchange for the waiver of a US$60.8 million liability.
The transaction is expected to materially reduce the company’s debt exposure and form the backbone of its balance sheet restructuring.
In addition, RioZim plans to dispose of several other assets to raise liquidity. These include the One-Step gold claim in Mhondoro and the Mtandahwe copper and tungsten claim in Chipinge, with minimum values set at US$1 million and US$3 million, respectively. The One-Step asset carries a conditional pricing mechanism linked to resource confirmation, allowing for a higher valuation if in-situ gold exceeds 400 kilogrammes, or an exit option if the deposit proves unviable.
The company is also targeting the sale of non-core properties in Nyanga and Newlands, while a previous disposal of a Msasa property for US$1.6 million has been ratified.
Alongside the disposal programme, RioZim has been authorised to secure a loan facility of up to US$35 million, to be backed by its remaining assets. The funding is intended to provide working capital and support the resumption of operations without issuing new shares.
RioZim operates the Renco, Dalny, and Cam & Motor gold mines, which have faced operational constraints in recent years. At Cam & Motor, output has been affected by the shift from oxide ore to refractory sulphide ore. Although a BIOX plant was commissioned in 2019 to process the sulphide ore, it has not been fully utilised due to funding limitations.
Legal challenge casts uncertainty
However, the implementation of the approved measures now faces uncertainty following an urgent application filed at the Commercial Division of the High Court by an anonymous shareholder seeking to place RioZim Limited under corporate rescue proceedings.
The applicant argues that such a move would trigger a legal moratorium, restricting the company from proceeding with major transactions, including asset disposals and financing arrangements, while the matter is before the courts.
Representations have also reportedly been made to the Zimbabwe Stock Exchange and the Securities and Exchange Commission of Zimbabwe, urging regulators to intervene.
If upheld, the application could delay the execution of RioZim’s restructuring plan at a critical stage, as the company seeks to reduce debt and restore operations.
