Trans Hex to dispose of Lower Orange River operations
JSE-listed diamond mining company Trans Hex’s subsidiary, Trans Hex Operations (THO), has entered into an agreement to sell its Lower Orange River (LOR) operations – the Bloeddrif and Baken mines – to black-women- owned LOR Diamonds for R72-million.
The agreement includes the disposal of the business conducted by THO relating to the exploration, prospecting, mining, recovery, treatment, production and disposal of diamonds in respect of the LOR operations.
Trans Hex has been directing its efforts towards securing a sustainable future for the LOR operations under a potential new dispensation, including exploring all reasonable means of avoiding staff retrenchments.
Accordingly, the transaction provides the company with an opportunity to implement its strategy for the LOR operations. It also provides the company with additional capital that can be used to fund its working capital requirements.
The purchase consideration will be settled through an initial payment of R50-million within seven business days of the signature of the agreement and subsequent deferred payments of R2.75-million each, totalling R22-million.
The aggregate deferred payment of R22-million is payable over a period of eight months, starting five months after the date of signature of the agreement.
THO and LOR Diamonds have also entered into a contract mining agreement, in terms of which LOR Diamonds will be appointed an independent contractor to THO and will undertake and conduct, for its own account and benefit, mining operations on the land and property forming part of the LOR operations pursuant to the LOR mining right.
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