Zimbabwe’s local listing plan won’t work, says Implats

Nairobi — Impala Platinum says Zimbabwe’s plan to compel mining companies to list the majority of their shares on the local exchange is not feasible and will impede operators’ ability to grow and invest in their assets.

Lawmakers in Zimbabwe are debating the measure as part of a bill that will also direct companies to use at least 85% of the funds raised from a Zimbabwean listing to develop their local rights. Platinum and diamonds are key exports for an economy that has halved in size since 2000 after a chaotic and violent land-reform programme under former president Robert Mugabe.

“A local primary listing would only be feasible with the requisite in-country capacity to raise the required capital and sustain daily trading volumes in the equity,” said Johan Theron, a spokesman for Johannesburg-based Impala whose Zimplats unit is the country’s biggest platinum producer. “We believe much work still needs to be done before the economy can structurally support this.”

Zimplats, which is listed on the Australian Securities Exchange, is seeing little interest from Zimbabwean entities even though investors in the country can already freely trade in the shares, “a clear sign” that a local listing is not viable at the moment, he said.

Impala would consider other options for local investors to participate in Zimplats and is still working to implement a community and employee share ownership plan, with each group holding 10% in the company, Theron said.