By Rosemary Mirondo
Dar es Salaam —
Petra Diamonds, which owns Mwadui- based Williamson mine, says it will
work with the government in the intended sale of its 75 per cent stake
in the business.
The company's
corporate communications manager, Ms Cathy Malins, told The Citizen that
they had apologised to the government for delay in communicating the
decision.
The government owns
a 25 per cent stake in Williamson mine. The UK-based miner, which also
operates two mines in South Africa, said it was divesting from the two
countries over mounting losses in operations due to a depressed global
market and effects of Covid-19.
Ms Malins was
responding to questions by The Citizen following Monday's announcement
by the government of Tanzania that it will not allow the sale of the
Williamson mine.
"We were remiss in
not advising the Government about the formal sale process announcement
prior to its release, for which we apologise. On Sunday 28 June,
following the release of the announcement on the evening of Friday 26
June, we wrote a letter to the relevant Government officials advising
them of the reasons for making the announcement," said Ms Malins in the
email.
She said the
rationale behind launching the formal sale process is to ensure that
Petra can consider all options available as part of the strategic review
of the business.
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"Any offers
received will be evaluated in light of the other strategic options being
considered by Petra and its advisers in order to determine what is in
the best interest of Petra and its stakeholders (which of course
includes the Government of Tanzania, as an important stakeholder in
Williamson)," she said.
On Monday Minerals
minister Doto Biteko reiterated that as a shareholder, the government
was dissatisfied with the manner in which Petra Diamonds was approaching
the matter.
The minister said
there were discrepancies in the notice for sale of the mine that should
be resolved before moving forward. "We were in discussion with the mine
and were at the last stage of signing a framework agreement, so you can
imagine our surprise when we saw the sale announcement," said Mr Biteko
in a telephone interview.
According to the
minister, Petra Diamonds did not inform the Williamson mine board which
would pass the same to the government as partners in the mine.
Mr Biteko said the government has a right of refusal or to engage a third party should it have been informed.
In her response, Ms
Malins said Petra is open to considering offers for either the Petra
group or individual assets, including its 75 shareholding in Tanzania
from all parties, including the Government.
"However, it is
important to note that even if offers are received, these may not result
in Petra Diamonds accepting such offers if these are not in the best
interest of Petra's stakeholders," she added.
According to her,
should the company receive a substantive offer of interest for the
acquisition of its 75 per cent interest in the Williamson mine from
other parties, it will consult with the Government about this and work
with them to evaluate the way forward.
Apart from
Williamson mine, Petra Diamonds also owns Finsch, Cullinan and
Koffiefontein mines in South Africa. The company said last week that it
was putting itself up for sale as it battles to service mounting debts.
This came after it
failed to make an interest payment on a $650 million (Sh1.5 trillion)
bond last month. But it won some breathing space from creditors who said
they would not declare a default until next month.
On Monday Mr Biteko
also stopped the planned retrenchment of workers at the Tanzania
operation when he visited the mine and held talks with the local
management. The price of one carat of diamond has dropped from $246
before the Covid-19 outbreak to $135 in March 2020.
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