China Africa Precious Metals (CAPM) has agreed to buy the Pamodzi Orkney gold mine for R150 million subject to conditions, says the mine's provisional liquidators and the company.
"This agreement is subject to the fulfilment of a number of suspensive conditions, including that all necessary regulatory and court approvals be obtained by certain specified dates," they said in a joint statement.
The agreement, which had been approved by the major secured creditor, the Industrial Development Corporation, received the backing of the unions affected, the National Union of Mineworkers and Solidarity.
"CAPM is 74 percent owned by Superb Gold Ltd, an affiliate of the SSC Mandarin Group, with 26 percent owned by a broad-based black economic empowerment consortium led by Mr Ellias Khumalo."
According to a Mail&Guardian report published in 2006, Khumalo, a former trade unionist, was part of President Jacob Zuma's inner circle.
He first made contact with Zuma in 1993 as a member of a "concerned Zulu" group seeking help in negotiating an end to KwaZulu-Natal's political violence. He later co-founded information technology company Multi-consult. Zuma spoke at the company's launch at a Durban hotel in the late 1990s, the paper reported.
CAPM intended spending over R525 million on developing and erecting a new gold plant at the mine. It wanted to restore operations and prepare the mine to resume full production within 12 months from the agreement's completion date.
SSC and CAPM chairman Robin Lee said the company was aware workers had endured a "sustained period of suffering and hardship".
"Our investment represents confidence in the government's leadership and their macro-economic policy," he said.
Solidarity deputy general secretary Gideon du Plessis said the union welcomed the agreement, but had conditions of its own.
The union wanted the re-appointment of its members who were sufficiently qualified to work at the Orkney mine and a collective agreement with all trade unions.
All employees' conditions of service had to be in writing. Dispute procedures and legal steps to be taken had to be set down in case of non-payment of employees' wages.
It also wanted a complete asset management plan.
Pamodzi went into liquidation in 2009, after which the liquidators accepted Aurora's R600 million bid for the Orkney mine in the North West and the Grootvlei mine in Springs, Gauteng.
Aurora is headed by former president Nelson Mandela's grandson Zondwa, and Zuma's nephew Khulubuse.
The company failed to raise the capital to follow through on the sale, and in June the liquidators ordered it to leave the mines. It operated the mines in the meantime, but failed to pay miners and allegedly stripped the mines' assets.
