JOHANNESBURG (miningweekly.com) – JSE-listed The Waterberg Coal Company has made a request to the ASX for an extension to its current voluntary suspension in the trading of its securities, which expires prior to the start of
trade on December 21.
This would, it outlined in a statement on Friday, allow it time to finalise a proposed third-party funding arrangement to replace its existing funding facility
with Standard Bank, which was due for repayment on April 9.
Following the signing of a term sheet in September, Waterberg, meanwhile, continued to advance talks with gold producer Sibanye Gold over Sibanye’s possible acquisition of an up to 51% stake in the coal producer.
As part of the deal, Sibanye agreed to inject A$8.5-million of working capital to enable the Waterberg to further develop its Waterberg coal project.
Owing to the seasonal break, the parties expected to finalise the negotiations, documentation and requisite board approvals in February next year.
“The replacement funding represents a significant transaction and the final terms of the proposal will impact the company's ability to carry out its future objectives;
“[Sibanye] has previously advised that it will maintain the facility as ‘on demand’ rolling daily basis, to give the discussions time to progress. [We are] of the view that reinstatement of trading for the company’s securities at this time is likely to be materially prejudicial to its ability to successfully complete the complex funding transaction contemplated,” Waterberg outlined.
It expected the voluntary suspension to remain in place until the proposed funding arrangement had been finalised.