Dumisani Nsingo, Senior Business Reporter
HWANGE Colliery Company Limited (HCCL)’s bid to settle its debt of $352 million through a Scheme of Arrangement will be determined by the outcome of the creditors’ voting process held last week.
HCCL managing director Engineer Thomas Makore told journalists at a Press briefing at the company’s pavillion at the Zimbabwe International Trade Fair that the outcome of the votes by the creditors for the facilitation of a scheme of arrangement to offset their debts would be released this week.
“The final nail for the HCCL scheme of arrangement took place yestersday (Wednesday) with Hwange creditors voting, yes or no. The creditors came in their numbers to determine the company’s fate by vote. The much awaited Scheme of Arrangement will kick start payment plans to Hwange Colliery’s creditors,” said Eng Makore.
He said the decision reached by the creditors would mark a turning point to the company’s strategic turnaround plan.
“The Scheme of Arrangement affords the company the operating space to implement its business and turn around plans.
Hwange Colliery was faced with a plethora of litigations and writs of executions which crippled its operations. The company’s assets are protected through the Scheme of Arrangement.
“As part of its strategy, the company will convert current to long-term liabilities and seek short to medium and long-term working capital facilities from banks. The financial resources will be channelled to production activities at Opencast, Underground mines and metallurgical operations so that production volumes will increase to above break-even point,” said Eng Makore.
He said the company would endeavour to ensure adequate supply of coal to the Zimbabwe Power Company for power generation while it focuses at exploring more local and export markets for both coke and coking coal.
“Adequate supply of coal to the national electricity utility will remain a priority while supply of profitable coal and coke grades to industry and export markets will ensure that the company operates profitably and meets its obligations in terms of the Scheme of Arrangement and monthly operating expenses,” said Eng Makore.
Asked what if the creditors were to vote against the Scheme of Arrangement, the HCCL boss said: “If the Scheme is rejected we would have to look at other options. Its not an outcome that we desire, the option would be judicial management, we definitely want to afford that”.