Photo by: Bloomberg
JOHANNESBURG (miningweekly.com) – Shareholders of gold producer Village Main Reef have voted in favour of Village’s proposed sale of its interest in the Consolidated Murchison (Cons Murch) antimony mine, in Limpopo, to Australian group Stibium Mining.
This followed a May announcement in which Village notified the market that it was selling its interests in the mine to Stibium for $15-million – with payment effected in two tranches of $8.4-million and $6.6-million.
The first of these phases followed on the regulatory and shareholder approvals, both of which had now been granted, and payment was expected towards the end of October.
The second payment would occur after Ministerial written approval of the transaction.
Village said that receipts from the sale would be used to strengthen the company’s balance sheet, thereby contributing to the group’s transition towards being a resources investment company.
Meanwhile, in a separate vote, Village’s shareholders approved the one-for-20 consolidation of the company’s share capital and the concomitant conversion of the consolidated shares into shares of no par value.
In line with the current Companies Act, the new consolidated shares would have no par value; however, the existing par value would be converted to a nondistributable reserve – an accounting move that would have no effect on the share’s value.
“The consolidation applies to the five-billion authorised shares of R0.125 each and the issued 1.04-billion ordinary shares, each of the same par value. Following consolidation, Village will have 250-million authorised shares and 50.2-million issued shares,” it outlined.
As previously announced, consolidation was expected to result in the narrowing of the spread between the bid-to-buy price of the shares and their offer-to-sell price, creating more stability and less volatility in the price.
This, in turn, was expected to add to the confidence of existing shareholders and enhance Village’s attractions to prospective investors.