Minergy CEO Morné du Plessis
Coal miner Minergy, which operates the Masama mine, in Botswana, has put its planned listing on the LSE's Aim on hold as a result of unfavourable market conditions.
“We remain committed to listing on the Aim, but current unfavourable market conditions are making it extremely difficult, with uncertainty surrounding Brexit weighing on decision-making," CEO Morné du Plessis said in a pre-close update to shareholders, published on Thursday.
The company will, in the months ahead, focus on its operations and related efficiencies around the plant and product output, while it awaits more certainty on the way forward with respect to Brexit.
Minergy will reconsider the Aim listing when overall conditions improve, stating that the proposed listing still holds many advantages, including an enhanced trading platform for shareholders, as well as access to a larger pool of funds for future mine developments and enhancements.
“We will continue to keep a close eye on the London market. We have already done a huge amount of work to position Minergy for the Aim listing, so once we find the right window of opportunity, we will be ready to list,” said Du Plessis.
Meanwhile, Minergy also noted that its plans to secure further offtake agreements had been hindered in recent months, as low coal prices had resulted in increased South African-mined coal entering the Southern African market.
"Minergy believes this setback is short term, as the coal price has already rebounded. It will, however, take some time for the excess coal currently in the market to work its way through the system and the consequences of severe price movements take around six months to filter through," the company pointed out.
Du Plessis said Minergy was operating the Masama mine and wash plant . . . to ensure sufficient coal is mined and processed to honour existing offtake agreements.
Minergy will continue with the push to tie up additional offtake agreements and secure further customers across the Southern African region as the market improves.