Pamodzi Gold faces liquidation demands
March 17, 2009
By Justin Brown
Beleaguered Pamodzi Gold is due to face a demand in the Pretoria High Court today for the liquidation of its Orkney mines over R21.8 million owed to Engineering Labour Hire and Mining Supplies.
The latter company made its application to the court last Tuesday. It said it had been providing 700 workers to Pamodzi Gold for underground work.
Bongi Radebe, a Pamodzi Gold spokesman, said the firm was aware of the application and would be opposing it.
Johan Engelbrecht, the Solidarity trade union's legal adviser on liquidations, said that another creditor, whose application papers he had not seen, was seeking the liquidation of Pamodzi's Free State mines
Pamodzi Gold has been battling to pay employees |
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He added that the second creditor could be seeking payment of R30-40 million.
Pamodzi Gold has been battling to pay employees and suppliers for months as it scrabbles for loan finance. At the end of September 2008 it owed suppliers R722 million.
In December 2008 it announced loans of R400 million to help it through its difficulties. It has received R200 million from the Industrial Development Corporation but is still waiting for R200 million promised by little-known Best Rock Investments.
Last week two senior executives of parent company Pamodzi Investment Holdings flew to New York, Toronto and Dubai in search of funding.
Kobus du Plooy, Pamodzi Holdings' director of resources, who made the trip, said he was working on a complete financial solution for Pamodzi Gold that would "take the company to the next level"
'Each mineworker supports eight to 11 dependants' |
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Pamodzi is under particular stress at its Free State mines, where in February it paid more than 4 000 workers only 60 percent of their wages. Solidarity has set up a fund to give these workers financial support.
Dirk Hermann, Solidarity's deputy general secretary, explained: "Due to the late payments, employees' medical aid funds have been frozen, while many are already experiencing considerable food shortages.
"According to our calculations, each mineworker supports eight to 11 dependants, which ultimately means that an estimated 32 000 to 44 000 individuals here will be without essential food and supplies."
Hermann said a "social welfare crisis" was unfolding in the Welkom area and could spread to the rest of the country.
So far Solidarity's social fund had raised R50 000 and distributed 150 food parcels to Pamodzi workers in Free State.
Pamodzi Gold employs 15 000 people, including contractors. Job losses of this magnitude would add to the already serious employment losses, mainly in the platinum and ferrochrome industries, that have resulted in thousands of workers thrown on to the streets.
Du Plooy declined to say who he had met during his overseas trip nor how much money he was seeking. "We are speaking to a number of funders," he said. "We believe that Pamodzi Gold has a very good future."
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