Published: 2 hours ago

The Zimbabwe Diamond and Allied Minerals Workers Union (ZDAMWU) has indicated that RioZim Limited's board and management could lose operational control if the union's urgent corporate rescue application is approved. The matter is currently before the High Court of Zimbabwe.

On April 28, ZDAMWU filed the application, citing deep insolvency and governance failures at the company, which reportedly carries a debt burden of at least US$191 million. The union highlighted that RioZim's liquidity position has steadily deteriorated over the past five years, with total liabilities exceeding assets by US$11 million as of June 30, 2024.

"The board that is disposing of the assets no longer has those powers in terms of the law," ZDAMWU General Secretary Justice Chinhema told NewsDay Business. "When a corporate rescue application has been filed, the powers and functions of the management and board of a company are suspended."

Chinhema accused the company of attempting to illegally dispose of assets while negotiations for a potential US$20 million working capital injection and the sale of mining and non-core assets were underway. ZDAMWU secured an interim court order on August 5, 2025, blocking these efforts pending the determination of the main application.

The union also raised concerns over unpaid wages, revealing that RioZim had accrued a backlog of approximately US$5.6 million after failing to pay workers since October 2024. Chinhema argued that the proposed asset sales were aimed at frustrating the corporate rescue process rather than addressing workers' salaries and long-term sustainability.

"If genuine intention exists, the company should approach the court for a transparent corporate rescue supervised for the benefit of everyone," he said. "All proposed recapitalisation plans lack sound strategy, and there is no guarantee for continued employment or economic stimulus in the communities where the mines operate."

Chinhema suggested that proceeds from the Dalny Mine should first be used to clear outstanding salaries before any recapitalisation or asset sales.
- newsday

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