HARARE, Zimbabwe's State Procurement Board (SPB) says six investors are interested in the recapitalisation of State-owned National Railways of Zimbabwe (NRZ).

NRZ infrastructure, which includes the railway and locomotives, has deteriorated in the last two decades, a situation made worse by a slump in economic activity which resulted in low freight volumes for the transporter. From moving more than 12 million tonnes at its peak in 1998, the parastatal in 2016 transported less than three million tonnes.

As a result of the reduction in freight volumes and failure by its shareholder to inject new capital, the parastatal has struggled financially and has over the years even failed to pay its workers and has a huge debt of more than 140 million US dollars.

NRZ requires a minimum injection of around 400 million USD to revamp its operations and went to tender seeking a partner to recapitalise. More than 20 firms expressed serious intentions to invest in the company in a debt or equity deal, but on Tuesday only six bids were unveiled.

Of the six, only three appeared to have met the tender requirements. The three are a Swiss firm, Crowe Horwath Chartered Accountants, which says it can secure funding amounting to 2.5 billion US dollars, a local firm, Croyeaux Private Limited, which proposes to inject about 700 million USD, and South African logistics conglomerate Transnet, which partnered with a local firm, Diaspora Infrastructure Development Group, to submit a tender in which they said they could provide 400 million USD.

China's Sino Hydro only submitted what was referred to as a regret, while China Civil Engineering sought leave to make a late submission. The sixth firm, SMH Rail of Malaysia, said it could rehabilitate some of the infrastructure and submitted a tender with a funding proposal of about 101 million USD.

NRZ Chairman Larry Mavhima who attended Tuesday's opening of the tender documents, said NRZ would within the next 10 days come up witha recommendation on the winner. What we are going to do now is to go through an adjudication process

in which we will eliminate those that have failed to meet the basic requirements and we should be able to do (that) within the next 10 days, he told journalists.

Basically looking at the list that has been submitted, I can see that there are only about three really serious bidders who have submitted in compliance with the request for proposals.

He said NRZ was looking for total recapitalisation, and of course rerarrangement of the balance sheet of NRZ.


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November 2017
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