Zimbabwe invites bids for fallen steel giant

August 25, 2010
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, HARARE, Aug 25 – Zimbabwe on Wednesday invited new bidders to take over the collapsed parastatal ZISCO steelmaker, after rejecting a 583-million-dollar offer from ArcelorMittal in May.

"Bids for a strategic partner for Zimbabwe Iron and Steel Company (ZISCO) are now open," Industry Minister Welshman Ncube said in a statement.

The government is looking to sell its 70 percent stake in the company, once one of Africa\’s leading steel producers with capacity to produce up to one million tonnes a year.

ZISCO stopped operations in 2008 at the height of Zimbabwe\’s economic and political crisis due to a lack of funding.

Ncube said the offers must reach the government by September 24.

In May, government rejected bids by ArcelorMittal and India\’s Jindal Steel and Power, with President Robert Mugabe saying the two companies were too big.

"The feeling is that we are a small country and we will have problems with a big multilateral company," Ncube said at the time.

"That is the feeling of the presidency, as strange as that might seem," he said.

ArcelorMittal had said it was ready to invest 4.3 billion rands (583 million dollars) for the possible acquisition of ZISCO.

The country\’s coalition government of Mugabe and Prime Minister Morgan Tsvangirai took office in February last year, and sees the sell-off of state entities as part of reforms needed to revive an economy shattered by a decade of hyperinflation that ended with dollarisation last year.
 

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