Sat Oct 22 10:53:44 SAST 2016

IDC court bid to shut down Pamodzi Gold

By Marcia Klein | Sep 11, 2009 | COMMENTS [ 0 ]

THE Industrial Development Corporation, the major creditor of Pamodzi Gold, has applied for the liquidation of the troubled miner.

IDC chief executive Geoffrey Qhena confirmed yesterday that the IDC had lodged papers and that the court date is set for today.

"As a state-owned entity we need to know what has happened to our money," Qhena said.

The IDC had lent Pamodzi more than R200million to help save the mines and jobs at the beleaguered company's operations. Since the provisional liquidation, the IDC had provided funding to keep the mines under care and maintenance in preparation to sell them off.

Pamodzi's mines - in the Free State, Orkney an on the East Rand, have already been under provisional liquidation for about six months after a funding crisis at Pamodzi Gold.

It managed to secure the IDC funding on condition that it raised a similar amount from other funders, but this never materialised.

Trade union Solidarity said yesterday that the liquidation would offer the liquidators "the opportunity to properly investigate the flow of funds in and between the various entities of the Pamodzi group".

This follows attempts by Pamodzi Gold's holding company, Pamodzi Investment Holdings (PHI), to make sure that the company was not liquidated. They have been trying to secure funds for the recapitalisation of the beleaguered mines, which have stopped production.

Recently, PIH stopped the liquidation process in its tracks when Harmony announced it was suspending its bid for the Free State operations.

This week, however, Harmony decided to proceed with the acquisition (for more than R400million) of Pamodzi Gold Free State.

Kobus de Plooy, a director of Pamodzi Investment Holdings, said yesterday that PIH directors had not seen details of the Harmony deal and once they did, they would decide whether to oppose the deal.

It is not clear whether they would appeal against the IDC's liquidation application.


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