JOHANNESBURG (miningweekly.com) – The R179.9-million sale of triple-listed Coal of Africa Limited’s (CoAL’s) Mooiplaats colliery, in the Ermelo coalfield, has been concluded.
CoAL and its black economic empowerment partner Ferret Mining & Environmental Services in October entered into an agreement with Mooiplaats Coal Holdings (MCH) and Mooiplaats Mining for the sale of the colliery, which has been under care and maintenance since 2013.
MCH has already paid R67-million of the purchase price, with CoAL having received R52-million and Ferret R15-million.
The balance of R112.9-million will be settled in no more than ten quarterly instalments, with the first payment due in August 2018.
Meanwhile, MCH has also replaced CoAL’s rehabilitation guarantee in terms of the Mooiplaats new-order mining right, as well as an Eskom guarantee. This will result in CoAL receiving a further R16-million that was not included in the purchase price in November.
“The sale of the Mooiplaats colliery concludes a process that commenced during 2013 and is the final step in CoAL’s five-point turnaround strategy. It is a significant achievement for the company and required coordination and completion of multiple transaction work streams.
“The funds received will be used to support CoAL’s project pipeline, in particular the development of our flagship Makhado hard coking coal project and/or potentially contribute to the acquisition of a cash generating asset,” CoAL CEO David Brown said on Thursday.
He also reiterated that the sale of Mooiplaats will result in about $1.4-million a year of overhead savings for CoAL.