JOHANNESBURG (miningweekly.com) – The China Africa Development Fund (CADF), which is funding former Pamodzi Gold managements' bid to save the company from liquidation, said on Thursday that it had "clear support" from South Africa's Department of Minerals and Energy to participate in the refinancing of the provisionally liquidated Pamodzi Gold.

CADF's statement followed that of Pamodzi Investment Holdings executive director Kobus du Plooy that the CADF backed bid for the entire group had the potential to be concluded far faster than any of the other deals under negotiation, and offered a significantly higher final amount of R1,7-billion, with R626-million being made available immediately.

CADF said that, since April, it had been working with Pamodzi Gold to structure a suitable combination of equity and debt funding to allow Pamodzi Gold to return to profitability, and to preserve the jobs of 13 000 workers.

It had since signed a letter of intent to provide R626-million, made up of R226-million of equity and R400-million of senior debt.

"A detailed plan of how this funding would be utilised to restore all the company's mines to operational status and profitability has been made available to the advisers of the provisional liquidators, Standard Bank, and to the preferred bidder for the assets of the Free State operations, Harmony Gold, which is also the largest shareholder in Pamodzi Gold," CADF told Mining Weekly Online.

In the course of this process, CADF said that South Africa's Department of Minerals and Energy had supported its participation in the Pamodzi Gold transaction.

CADF said that it had also cooperated with South Africa's State-owned Industrial Development Corporation (IDC) in taking the process forward.

"There is considerable common ground between the mandates of the IDC and the CADF, and it is hoped that this investment proposal will be accepted, and that it will mark the beginning of ongoing cooperation between the two organisations," CADF said in the release.

CADF said that it was a wholly owned subsidiary of the China Development Bank and had been mandated to provide $5-billion in funding for projects on the African continent.

A memorandum of understanding had been signed between itself and South Africa's Department of Trade and Industry to promote cooperation in the development of infrastructural projects in South Africa.