GREAT Dyke Investments (GDI), a Russian-backed project planning to build Zimbabwe’s biggest platinum mine, has sold a 4.4% stake to Fossil Mines Ltd. as Covid-19 disrupted fundraising for the venture.
Fossil, owned by Zimbabwe’s Obey Chimuka, will invest US$30 million in the Darwendale project, through a combination of cash and services, including for engineering, procurement and construction.
Obey Chimuka, managing director of Fossil Contracting, a company associated with Kudakwashe Tagwirei, now sits on the GDI board. Chimuka has in the past sat on the boards of the ZMDC and Marange Resources. He also sat on the board of Sakunda Supplies, according to his company’s website.
That leaves tycoon Vitaliy Machitski’s Vi Holding and Zimbabwe’s Landela Mining Venture Ltd. each with a 47.8% stake. The sale values Great Dyke Investments at $680 million.
Great Dyke Investments Chief Executive Officer Alex Ivanov said the coronavirus pandemic has delayed project fundraising, which was originally due to be completed this year.
Financing of $665 million is now expected to be finalized in the first quarter of 2021, Ivanov said in an emailed response to questions. The lead arranger for that funding is Cairo-based Afreximbank.
The Darwendale project has the potential to become one of the world’s biggest platinum mines and its development is central to the Zimbabwean government’s plans to reboot a collapsing economy.
Zimbabwe has the world’s third-largest platinum group metal reserves after South Africa and Russia.
Former president Robert Mugabe handed the Darwendale concession to Russian investors in 2006 after the government repossessed land from a local unit of South Africa’s Impala Platinum Holdings Ltd.
In May last year, Bloomberg reported that a Zimbabwe army investment vehicle’s shareholding in the project was putting off potential financiers.
But President Emmerson Mnangagwa said the military had been bought out by a private company, now identified as Landela, which now owns 50% of the mining venture.
Tagwirei’s interest in GDI marks further expansion from the petroleum industry where his Sakunda Holdings is a dominant player, into mining. – Bloomberg/Zimbabwe Voice ■