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Update on Sale of Non-Core Assets
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")
ANNOUNCEMENT
2 December 2013
UPDATE ON SALE OF NON-CORE ASSETS
Coal of Africa Limited (“CoAL” or “the Company”) which operates in South Africa, together with its subsidiaries, is pleased to announce further
progress on the company’s five-point turnaround strategy.
1. Attaining strategic investor – completed February 2013 with Beijing Haohua Energy Resource Co. Limited
2. Reduction in overhead structure - completed July 2013, 30% reduction in overheads
3. Product quality confirmation at Vele – coal quality tests completed in August 2013 and plant modification approved by the Board
4. Thermal assets restructure – target completion June 2014 for all assets identified
5. Secure funding for Makhado and obtain regulatory approvals – target completion end of Q3 CY 2014
With regards to Point 4 of the turnaround strategy, CoAL had identified five non-core thermal assets (Woestalleen Colliery*, Opgoedenhoop**,
Lemur, Holfontein and Mooiplaats Colliery) for which the Company has been engaged in a sales process. Further to the closure of Mooiplaats
Colliery in September 2013, CoAL is pleased to announce the following progress relating to the sale of the non-core thermal assets;
• The disposal of the mining right associated with the Portion 5 of the farm Opgoedenhoop.
• The disposal by CoAL of all shares and intercompany loan accounts in NuCoal Mining Proprietary Limited (the “Woestalleen Complex”) to
Blue Falcon 212 Trading Proprietary Limited for R80 million (US$7.9 million) in cash. The Wostalleen Complex is held on the balance
sheet as an asset held for sale at US$ 0.98 million as at 30 June 2013 and generated US$ 95.6million in revenue for the FY 2013, but the
resource in the form of Vuna Colliery was mined out by April 2013 and would have no future economic benefits to the Company.
All conditions precedent to the sales of Woestalleen Complex and Opgedoenhoop have been met, including the provision by the buyers of proof of
funding. However before the transactions can be completed and payment received, approval by the Department of Mineral Resources(“DMR”) in
terms of Section 11 of the Mineral & Petroleum Resources Development Act, 2002 is required. Applications with respect to both sales were
submitted to the DMR in September 2013 with the Company awaiting approval of the changes in ownership. The Woestalleen complex and
Opgedoenhoop have been sold for a combined R100.8 million (US$9.95 million) in cash. The proceeds will be used for working capital.
In addition, progress has been made on the disposal of CoAL’s shareholding in Lemur Resources Limited to Bushveld Minerals Limited, a company
listed on the AIM of the London Stock Exchange. CoAL has received 19.5 million Bushveld Minerals Limited shares as consideration.. The
Company is in the process of exploring options to monetise this asset.
*Woestalleen Complex consists of the Woestalleen wash plant, the rapid load out facility and the Vuna Colliery. The Vuna Colliery was mined out in April 2013.
** Opgoedenhoop is an undeveloped mining right held by NuCoal Mining Proprietary Limited.
For more information contact:
David Brown Executive Chairman Coal of Africa +27 11 575 4363
Michael Meeser Chief Financial Officer Coal of Africa +27 11 575 4363
Celeste Harris Investor Relations Coal of Africa +27 11 575 6857
Tony Bevan Company Secretary Endeavour Corporate Services +61 8 9316 9100
Company advisors:
Jos Simson/Emily Fenton Financial PR (United Tavistock +44 20 7920 3150
Kingdom)
Chris Sim/Jeremy Ellis Nominated Adviser Investec Bank plc +44 20 7597 5970
Charmane Russell/Jane Kamau Financial PR (South Africa) Russell & Associates +27 11 880 3924 or
+27 82 372 5816
Investec Bank Limited is the nominated JSE Sponsor
About CoAL:
Suite 8, 7 The Esplanade, Mt Pleasant, Perth WA 6153, Australia, Tel: +61 8 9316 9100, Fax: +61 8 9315 5475, Email: perth@coalofafrica.com ACN 008 905388
ZA: 2nd Floor, Gabba Building, The Campus, 57 Sloane Street, Bryanston, Johannesburg, South Africa 2021, Tel: +27 11 575 4363, Fax: +27 11 576 4363,
Email: admin@coalofafrica.com
David H.Brown – Executive Chairman, Michael G. Meeser – Chief Financial Officer
Non-executive directors: Peter G. Cordin, Khomotso B. Mosehla , David J. K. Murray, Bernard R. Pryor, Rudolph H. Torlage
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 Greater Soutpansberg Project /MbeuYashu, including CoAL’s Makhado Project (coking and thermal coal).
Date: 02/12/2013 04:05:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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