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Michael Magoronga Midlands Correspondent
A proposed joint venture between Indian firm Whinstone Enterprises and Lancashire Steel has been put on hold after the Indians failed to follow Government procedures.

According to an agreement signed in July last year, the Indian investor was supposed to inject money into the business, while Lancashire Steel was to provide labour, skills and equipment.

Since Cabinet approved the deal, the Indians have been taking shortcuts and disregarding the laid-down channels of doing business, forcing Government to suspend the deal.

Industry and Commerce Minister Mangaliso Ndlovu confirmed that the deal had been put on ice for now.

“Government’s position is that the contract is not legal unless and until the company follows the proper way of doing things. They have to do things properly and until they do so there is no deal as of now,” said Minister Ndlovu.

Although he could not be drawn into discussing the finer details of what went wrong, Minister Ndlovu said the company risked losing the deal completely if it did not put its house in order.

He said Government was giving the company an opportunity to redeem itself and salvage the deal.

“There is no agreement yet, so if they are still keen on the deal they should do things the correct way,” said Minister Ndlovu. “Otherwise Government will find another suitor. But for now, the door is still open for them.”

Minister Ndlovu assured the nation and Kwekwe residents in particular, not to worry about the collapse of the deal, saying Government was more committed to reviving companies in the city more than ever before.

“I can assure you that companies in Kwekwe, especially Lancashire, will be back on their feet very soon,” he said. “Government is more committed than ever before. Recently we facilitated the opening of ZimCoke which will employ more than 1 000 workers.

“Kwekwe is an industrial hub and people there should not lose sleep because as Government we have the city at heart.”

Lancashire Steel stopped operating in 2010 after facing operational challenges owing to the demise of Ziscosteel, its major raw material supplier.

At full throttle, the company employs about 600 workers.