MEIKLES expects to conclude a deal with foreign investors who intend to invest in the group’s mining portfolio, which the company views as an area of substantial growth potential. Sources close to the developments told The Herald Business that the investors, who are expected in the country next week, are eyeing a partnership with the group’s Meikles Centar Mining division.
Meikles has added some aggression into mining as it views the sector as an area that has potential to add wealth to its growing business portfolio. Meikles recently paid around $10 million for Duration Gold mine’s Imviga Mine in Matabeleland. The group has also set aside funds to acquire other claims around Imviga mine to consolidate its position.
In the year to March 2014 Meikles chairman Mr John Moxon said the group looks to its strategic partners to provide finance and mining skills. MCM purchased 75 percent equity in a company that owns a number of chrome claims on the Great Dyke.
“Proposals have been submitted to the Ministry of Mines related to a significant chrome related project, which include construction of a smelter to beneficiate both lumpy and alluvial ore. The project will cost in excess of $100 million,” said Mr Moxon.
Meikles carried out limited exploration on an iron ore claim and the results were positive. Further tests are required to determine the full extent and quality of the ore reserves. The group expects a positive change of fortune going into the second half following a new investment into its retail business as the $90 million held by the Reserve bank of Zimbabwe begins to flow in.
Meikles hopes the retail division will spur revenues in the second half. Recently Meikles and the group’s South African partner Pick n Pay secured $25 million for an expansion programme with the group’s subsidiary TM Supermarkets. The group is expecting a windfall from the Reserve Bank of Zimbabwe as negotiations for the release of its $90 million held by the central bank have been successful and will utilise the funds towards restructuring its business in Zimbabwe and in South Africa. Meikles said shareholders will be advised fully of any new developments “as a matter of urgency”.
Meikles indicated in its update to shareholders last week that it has operated so far without any benefit from its deposits held by the apex bank. The release of these funds will help the recapitalisation of its retail division and help in the group’s expansion drive while the new money from Pick n Pay will help spruce up its TM brand. Pick n Pay has so far injected $14 million into refurbishments from the $25 million it secured from Standard Chartered Bank.
TM and Pick n Pay have so far opened three new stores and re-launching two stores in Kadoma and Chivhu. The Group’s objective will be the enhancement of shareholder values to the benefit of stakeholders.
Source: The Herald