A showdown among cabinet ministers is looming over the country's largest platinum producer, Zimplats, amid divisions and tensions on how Youth Development, Indigenisation and Empowerment Minister Saviour Kasukuwere is handling the contentious issue.

Kasukuwere on Tuesday rejected indigenisation proposals from Zimplats, which is 87% owned by South Africa's Impala Platinum (Implats), intensifying the dispute.

The company holds approximately two thirds of the Hartley Complex, the largest of the platinum-hosting centres on Zimbabwe's mineral-rich Great Dyke belt, positioning itself as a key supplier of platinum.

Implats is one of the most significant producers of platinum and platinum group metals in the world, with operations on the Bushveld Complex in South Africa and the Great Dyke.

Zimplats, like many other foreign-owned companies, has been affected by Zimbabwe's controversial indigenisation laws which require that it should surrender a 51% shareholding to local investors.

Thousands of companies, mainly from Britain, United States and South Africa, including mining houses, banks and manufacturing firms, have been affected.

Implats's Zimbabwean joint venture, Mimosa Platinum, is currently under pressure to meet empowerment thresholds.

Kasukuwere says Zimplats's proposals do not meet indigenisation requirements.

"Zimplats continues to defy the laws of this land and continues to abuse the process. We have tried to engage it in a manner that achieves a win-win situation but it appears that as government we have reached the end of the road," Kasukuwere said. "We have already written to the Ministry of Mines."

However, senior officials in the ministry said the responsible minister, Obert Mpofu, had not agreed with Kasukuwere's approach of threatening companies and blackmailing them by threats of withdrawing their operating licences.

Kasukuwere recently temporarily cancelled the licence of Blanket Gold Mine owned by Canada's Caledonia Mining Corporation.

The licence was restored after talks and protests by Mpofu, who opposed Kasukuwere's decision.

There are serious divisions within government, particularly among ministers, over the issue. A senior mines ministry official said: "Mpofu supports the policy of indigenisation but not Kasukuwere's approach. That's why they clashed over Caledonia and are on a collision course over Zimplats".

Kasukuwere says Zimplats remains defiant. "We have done everything in our power to negotiate with Zimplats but it continues to find loopholes," he said, adding negotiations were now "a dialogue of the deaf".

Zimplats has been arguing that it has met its obligations since it ceded money-spinning concessions to government and invested millions in social development projects.

Zimplats on Thursday confirmed it was in receipt of Kasukuwere's letter dated September 6 which rejected its indigenisation plan. The letter also said the minister had now asked Mpofu to cancel Zimplats's licence, something he was unlikely to do.

"We would like Zimplats to continue mining but if it continues to disregard the laws of the country we are left with no option but to invoke the provisions of the law. Zimplats will have to live with the consequences of its actions," Kasukuwere said.

However, Zimplats has agreed to rework its plan and continue negotiating. Zimplats deputy chairman Muchadeyi Masunda said his company was willing to talk but Kasukuwere must stop "behaving like the proverbial bull in a China shop".

Implats chief executive David Brown said last month his company wanted to retain full control of Zimplats, protesting Zimbabwe's equity policy "does not work".

Implats is determined to retain control of its Zimbabwe operations and has announced a $500-million expansion project, bringing its total investment close to $1-billion, the single largest investment in the country.

Zimplats contributes about 10% of Implats's output. Zimbabwe has the second largest platinum reserves after South Africa.

Implats recently announced "excellent financial results" on the back of improved operational performance.

Brown said: "This was a positive year for Implats which delivered a solid operational and financial performance. We improved our gross production supported by our Rustenburg and Zimplats operations, which achieved their targets."