Akhir 05 , 1432 H. / March 10, 2011 -- India's Essar Group has signed a 750-million-deal for the takeover of the long ailing Zimbabwe Iron and Steel Corporation (Zisco), local media reported Thursday, according to dpa. The government agreed to sell a 54 per cent share in Zisco to the Mauritius-based Essar Africa Holdings, according to the Herald newspaper. The signing took place late Wednesday. The deal would effectively release the government from its obligation in respect of the external debt owed by Zisco to foreign entities such as Germany's KfW Bank, Industry Minister Welshman Ncube was quoted as saying. Essar Africa would also pay the estimated 45 million US dollars for the the iron and steel mill, as well as 22 million dollars in salaries owed to workers. Ncube confirmed that Essar had been exempted from government regulations demanding foreign companies cede 51 percent of their shareholdings to black Zimbabweans. Zisco was Africa's second biggest iron and steel plant at independence in 1980, but analysts say it was steadily run down by underfunding, mismanagement and corruption. It has been shut down since 2008. The Essar Group is to undertake resuscitation work at Zisco, including realigning blast furnaces and repairing coke ovens. "Our intention is that in the next 10 to 15 months we start producing steel," Ravi Ruia, Essar Group vice chairman told journalists. He estimated production of 1 million tons a year.
