Wrap Text
CZA - Coal of Africa Limited - Acquisition of Rio Tinto and Kwezi`s South
African coal assets completed
Coal of Africa Limited
(Incorporated and registered in Australia)
(Registration number ABN 008 905 388)
ISIN AU000000CZA6
JSE/ASX/AIM share code: CZA
("CoAL or the "Company" or the "Group")
Acquisition of Rio Tinto and Kwezi`s South African coal assets completed
"Transaction strengthens Coal of Africa`s position as one of the most
substantial holders of prospecting and mining rights for coking coal in South
Africa`s Soutpansberg coalfield," says CEO John Wallington.
Coal of Africa Limited ("CoAL" or "the Company"), the coal exploration,
development and mining company operating in South Africa, is pleased to advise
that the consents, required under the Section 11 of the Mineral and Petroleum
Resources Development Act ("Section 11 consents"), have been granted by the
Minister of Mineral Resources in respect of the sale of shares by Rio Tinto
Minerals Development Limited ("RTMD") and Kwezi Mining (Proprietary) Limited
(collectively "the Vendors") in both Chapudi Coal (Proprietary) Limited
("Chapudi") and Kwezi Mining and Exploration (Proprietary) Limited ("KME") to
Keynote Trading & Investment 108 Proprietary Limited ("Keynote"). Keynote is a
subsidiary of the Company, with a recently constituted Board of Directors and
Rothe Investments as the 26% Black Economic Empowerment ("BEE") shareholder.
Chapudi and KME hold the prospecting rights for the Chapudi Coal Project and
related exploration properties in South Africa`s Soutpansberg coalfield in the
Limpopo Province, (collectively, the "Chapudi Coal Assets"). The Section 11
consents relate to the transfer of an interest or control in a mining or
prospecting licence holder.
Coal of Africa CEO John Wallington commented that, "The granting of the Section
11 consents by the Minister concludes the regulatory steps to complete the
acquisition of the Chapudi Coal Assets, strengthening Coal of Africa`s position
as one of the most substantial holders of prospecting and mining rights for
coking coal in the region. The transaction provides significant scale and
optionality in the planning of future mining projects, and will enable the
consolidation of several contiguous tenements in the Soutpansberg coalfield. The
detailed planning and technical work required as part of this process has
commenced with our partners, while the reserve and resource calculations of
these newly-acquired coal assets are being evaluated and a further update will
be issued to the market in due course."
Mashudu Ramano, Chairman of Rothe Investments noted that, "We will seek to
develop these assets responsibly, and in the interests of all stakeholders. The
consolidation of the various tenements will provide further long-term potential
for the economic development of this region. Communities in close proximity to
Chapudi hold a 40% interest in Rothe, the structure of which will be finalised
in consultation with the relevant communities, making this a truly broad-based
BEE project."
As advised in the report for the quarter ended 31 March 2012, and released on 30
April 2012, the original share purchase agreement ("the Original SPA") was
amended to allow for the sale of equity and the sale of shareholders` claims to
close separately (the "Amended SPA"). This amendment facilitated the application
by the vendors for South African Reserve Bank ("SARB") exchange control approval
for separate payment in respect of the sale of the equity and shareholder
claims. In anticipation of a longer period to obtain approval for the settlement
of the shareholder loans, the priority for the Vendors, the Company and Keynote
was to close the equity sale.
In line with the Amended SPA, the date for the fulfilment of the conditions
precedent for the sale of the equity was extended from 30 April 2012 to 31 May
2012. The date for the fulfilment of the conditions precedent for the sale of
the shareholder claims was extended from 30 June 2012 to 31 July 2012. The
purchase consideration remains US$75 million in aggregate, of which a $2 million
deposit has been paid. SARB exchange control approval for the sale of the equity
was received in early April 2012 and having satisfied the remaining conditions
precedent final closing of the transaction is expected to occur on 11 May 2012
following settlement of the first tranche of the purchase consideration due
under the terms of the Amended SPA.
On closing, Keynote will take ownership of the equity and pay the first tranche
of the purchase consideration of US$29,357,545 to the Vendors. Upon granting of
exchange control approval by the SARB in respect of the shareholder claims, the
remaining amount due under the first tranche of US$13,642,455 is payable by the
Company to RTMD. The second tranche of $30 million will become payable either on
the receipt of a New Order Mining Right ("NOMR") on any of the properties that
form part of the prospecting area in any of the New Order Prospecting Rights
("NOPRs"), or two years from the date upon which the conditions precedent are
fulfilled, whichever transpires earlier.
10 May 2012
Johannesburg
JSE Sponsor
J.P. Morgan Equities Limited
For more information contact:
John Wallington
Chief Executive Officer
Coal of Africa
+27 11 575 4363
Wayne Koonin
Financial Director
Coal of Africa
+27 11 575 4363
Shannon Coates
Company Secretary
Coal of Africa
+61 893 226 776
Sakhile Ndlovu
Investor Relations
Coal of Africa
+27 11 575 6858
Chris Sim/ Jeremy Ellis/Neil Elliot
Nominated Adviser
Evolution Securities
+44 20 7071 4300
Jos Simson/Emily Fenton
Financial PR (United Kingdom)
Tavistock
+44 207 920 3150
Ruben Govender
JSE Sponsor
J.P. Morgan Equities Limited
+27 11 507 0430
Charmane Russell/Jane Kamau
Financial PR (South Africa)
Russell & Associates
+27 11 880 3924
+27 82 372 5816
www.coalofafrica.com
About CoAL:
CoAL is an AIM/ASX/JSE listed coal exploration, development and mining company
operating in South Africa. CoAL`s key projects include the Vele Colliery (coking
and thermal coal), the Makhado Project (coking coal) and the Mooiplaats and
Woestalleen Collieries (both thermal coal).
The Mooiplaats Colliery commenced production in 2008 and is currently ramping up
to produce 2 Mtpa. The Woestalleen Colliery, acquired through the acquisition of
NuCoal Mining (Pty) Limited in January 2010, currently processes approximately
2.5Mtpa of saleable coal for domestic and export markets. The Woestalleen
Complex also incorporates three beneficiation plants with a total processing
capacity of 350,000 run-of-mine (ROM) feed tonnes per month.
CoAL`s Vele Colliery started commercial production in Q1 2012. During the
initial phase, the operation is targeting 2.7 Mtpa ROM production to produce
1.0Mtpa of saleable coking coal. The Makhado Project, CoAL`s flagship project in
the Soutpansberg coalfield, is well into the feasibility stage, with a
Definitive Feasibility Study having been reviewed by the CoAL Board in March
2012. An application for a New Order Mining Right for the Makhado Project was
submitted in January 2011.
In November 2010, CoAL agreed to acquire the Chapudi coal project and several
other coal exploration properties in the Soutpansberg coal basin in South Africa
from the previous owners, including Rio Tinto. The acquisition of the Chapudi
Coal Assets strengthens Coal of Africa`s position as one of the most substantial
holders of prospecting and mining rights for coking coal in South Africa`s
Soutpansberg coalfield.
Date: 10/05/2012 08:55:01 Supplied by www.sharenet.co.za
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