By The Business Day (Brian Latham)    

ZIMBABWE’s High Court has rescinded a judgment that affirmed British company African Consolidated Resources’ rights to the lucrative Marange diamond field that was seized by the government.  

Yesterday, the shares fell the most since May as the company said it would immediately appeal to the Supreme Court against the rescission. It said the move would have the effect of suspending the judgment. 

African Consolidated bought the Marange project from De Beers in March 2006, but was evicted in October that year by the government, which took control of the fields through the state-owned Zimbabwe Mining Development Corporation.  

Last September, High Court Justice Charles Hungwe ruled that mining claims at Marange belonged to African Consolidated, and mining operations being carried out by Zimbabwe Mining Development Corporation in joint ventures with closely held South African companies Mbada Investments and Canadile Miners should be suspended.  

Mbada and Canadile sold 900000 carats of diamonds at an August 12 auction, raising about R72m, Finance Minister Tendai Biti said last week.  

“We will be appealing the judge’s decision to the Supreme Court, which has the effect of suspending the ruling so that existing orders still stand,” African Consolidated CE Andrew Cranswick said in Maidstone, England.  

He said the “company remains ready and willing to reach a compromise settlement with government on the issue”.  

The company said it would issue a more detailed response on receipt and analysis of the written judgment.  

Justice Hungwe ruled that African Consolidated Resources had concealed important information in the case last September that its subsidiaries were not yet registered at the time of obtaining the mining rights, the Zimbabwe Guardian reported. 

“Only a person can be granted a prospecting licence. Since none (of the subsidiaries) was incorporated, there was no person to release a certificate of mining,” Justice Hungwe said. He said that the company’s subsidiaries were guilty of fraud through misrepresentation.  

African Consolidated shares fell as much as 20% in London and traded 16% down at 9,25p before midday yesterday, putting them on course for their biggest decline since May 11. Bloomberg, Staff Writer

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