JOHANNESBURG (miningweekly.com) – The Waterberg Energy Group (WEG), which included dual-listed Waterberg Coal Company (WCC) and its controlled entity Firestone Energy, is in negotiations with Villora, soon to be AME International, to assist in the recapitalisation of WCC’s balance sheet.
The recapitalisation included the provision of working capital and a potential transaction to acquire the secured convertible note held by Standard Bank South Africa (SBSA) and other WCC noteholders.
WCC noted that while discussions with AME were progressing, AME was also in discussions with SBSA in respect of the proposed transaction. “We are advised that, if AME is successful in its negotiations with SBSA, it would be its intention to convert the debt into ordinary equity in the capital of the company,” said WCC.
AME had also proposed to procure sufficient working capital to advance the WCC’s Waterberg coal project (WCP), in Limpopo, but would also complete the recapitalisation of WEG’s balance sheet.
“While the company is supportive of the proposed transaction, it cannot give any certainty on the completion nor the timing of the proposed transaction, as it requires the support of the noteholders,” WCC stated.
WCC further advised that it was in discussions with potential financiers to arrange suitable project financing for the prospective development of the WCP. “The company will keep the market advised of developments when terms of a financing mandate have been agreed and executed.”
The company was in preliminary negotiations with various prospective coal offtaking parties and logistics operators for the transport of coal products to the Richards Bay Coal Terminal.
“These discussions are progressing well and as soon as negotiations have been finalised and agreements entered into, the market will be advised accordingly,” said WCC.
While the offtake agreements were progressing, WCC noted that it had been in contact with noteholders to gain support for the proposed transaction, as well as for the provision of an interim working capital facility pending the completion of the potential transactions.
WCC also on Thursday announced changes to its board of directors.
Former Southern Africa Coal Processing Society chairperson Mark Craddock had been appointed director and acting CEO, to succeed outgoing Stephen Miller, while Gavin Rodie was appointed nonexecutive director.