By Nelson Banya and Ranga Mberi
The government has always denied that businessman Kuda Tagwirei has a key role in Kuvimba, a mining company that has emerged as one of Zimbabwe’s biggest mining firms. Now, a stash of emails leaked from a disgruntled executive places Tagwirei at the centre of the company’s ownership, and lifts the lid of how he acquired some mining assets over the past two years.
While it was Sotic International that bought mines, among them Bindura Nickel Mine (BNC) and Shamva gold mine, the assets are now under Kuvimba. This transfer of ownership has raised questions for both Sotic and the government, which says it owns 65% of Kuvimba.
Christopher Fourie was one of the directors of Sotic, and was even seconded to the BNC board after the 2019 acquisition.
However, Fourie fell out with Sotic last year, resulting in a court case. Sotic went to court to stop Fourie from criticising the company in public. Now a stash of emails have been made available by Fourie and published by Sentry, a US anticorruption watchdog founded by actor George Clooney and John Prendergast.
Below, we detail part of what the emails reveal:
Yes, Tagwirei does ‘call the shots’ at Sotic
Zimbabwean government officials, as well as Sotic CEO David Brown, have always denied Tagwirei’s involvement in either Kuvimba, Sotic or Landela, despite common directorships across the companies.
The Fourie emails claim to show that Tagwirei does, in fact, call the shots.
In one email said to be from Tagwirei, the businessman purportedly writes to Sotic directors Fourie, Jozef Behr and Ronelle Sinclair to stop their fighting: “We are about to make one of the biggest companies in Southern Africa and here you are jostling and fighting. We have so much work ahead of us.”
Other emails claim to show Tagwirei giving instructions to SOTIC and Landela directors on a range of issues, including who to nominate to boards, authorising payments, and even deciding on operational issues as minor as paying for an office printer.
Executives, including Obey Chimuka, refer to Tagwirei in various emails: “Kuda is of the view”, Chimuka writes, Behr wrote, “as you aware, Kuda is the boss and approves and/or initiates all payments made.” One email from Fourie says to Tagwirei “this is your money and you call the shots”.
In August 2019, Shaan Kundomal of Capital Horizons, a management company based in Mauritius, reportedly wrote to Tagwirei and his advisors: “Indeed it has always been our understanding that Mr. Tagwirei would be an owner of the Sotic International Limited at a point in time.”
Tagwirei’s ownership of Sotic is also traced via a chain of companies. Almas Global, a Cayman Islands fund that has publicly said it previously backed Sotic’s Zimbabwe acquisitions, owns 65% of a company called Ziwa Resources. The other 35% of Ziwa Reseources is owned by Pfimbi Resources, whose directors are listed as Tagwirei and his wife.
The shareholding structure therefore once again calls into question the publicly announced ownership of Kuvimba.
In one email, Tagwirei reportedly writes: “Still waiting for the cash flows for Our Zim alloys. HE wants
that money to be paid after I show him the directors, owners of Sotic-Documents.”
ZimAlloys, which has just emerged from judicial management, is one of the companies listed under Kuvimba.
The GDI stake may have cost up to US$200 million
In 2019, it was announced that Landela Mining Ventures was now the 50% partner of Russia’s Vi Holdings in the Darwendale platinum venture. Landela bought the stake from the Zimbabwe Defence Forces’ company, Pen East. The price was never revealed.
The only clue, so far, came in March last year after Chimuka’s Fossil Mining paid US$30 million for a 4.4% stake in the operation. This implied a valuation of US$680 million for the whole GDI.
But emails said by Sentry to be from Tagwirei’s lawyer, Norman Chimuka, sent in November 2019 and February 2020, reveal that Sotic was under pressure from ZIMRA to pay capital gains tax of US$11 million. This suggested that Sotic paid Pen East US$220 million for the 50% stake.
How Tagwirei bought into BNC
In 2019, Sotic bought BNC and Freda Rebecca Mine from Asa Resources. To buy these assets, Tagwirei first approached Trafigura, his former partners.
That arrangement fell through, and he decided to put up the money himself. He allegedly informed Sotic directors that he would fund the transaction from money from South Africa, Zimbabwe, and Mauritius.
But, to do that, he needed a structure that would not link back to him, the report claims.
His advisors Capital Horizons arranged a complicated structure in which Sotic International issued debentures to Almas, the capital fund. The deal allowed Tagwirei to send money to Almas, who then sent money to Sotic.
In one May 2019 email sent from one of Sotic’s directors to Tagwirei and his lawyer, it is said: “Kuda, as mentioned, attached is a profit sharing debenture agreement. After discussing with Capital Horizons, I think this can work as an agreement for you to at least participate in the profits of Sotic. The reason that it is unsecured, is that we would then not have to disclose it as part of KYC and/or to the banks.”
Tagwirei’s CBZ link
Tagwirei’s interest in CBZ, the country’s biggest bank, has been subject to speculation since 2019. In one email, Shaan Kundomal, who heads Capital Horizons, circulated minutes in which he had discussed proposals on how to buy the 14% share of CBZ held by the Libyan Bank.
What Kuvimba CEO David Brown says?
David Brown, the former Implats CEO who now heads Kuvimba, denies any knowledge of Tagwirei’s involvement.
He said the allegations are all part of claims by Fourie, after his dismissal from Sotic. A lot has changed at Kuvimba, he said in an email to Sentry.
“A lot has changed over the last year, driven by the desire to create a standalone mining business with the express purpose of creating value to as many Zimbabweans either as employees or shareholders as possible and in fact declared a maiden dividend for the benefit of many beneficiaries,” says Brown.
“Therefore it is important to provide some context with regard to the ‘source’ of these allegations. These matters are largely driven by a disgruntled employee who is part of a history that might well have been involved in matters you raise but I cannot comment on any of claims relating to pre-June 2020 as stated above. In fact, my role since coming on board has been largely limited to the mining company and less to no involvement in any other companies.”
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