Pamodzi -- announcement of mine sale

The Joint Provisional Liquidators of Pamodzi Gold Orkney (Pty) Ltd (in provisional liquidation) ("PGO") and China African Precious Metals (Pty) Ltd ("CAPM") announced that an agreement has been concluded for the acquisition by CAPM of all of the assets of PGO relating to its Orkney gold mine for a consideration of R150 million, subject to adjustments in terms of the agreement that may be applicable in respect of removed or destroyed assets.

This agreement is subject to the fulfillment of a number of suspensive conditions, including that all necessary regulatory and court approvals be obtained by certain specified dates, but has been approved by the major secured creditor, the Industrial Development Corporation of South Africa Ltd ("IDC"), and is supported by the trade unions NUM and Solidarity. CAPM is 74% owned by Superb Gold Ltd, an affiliate of the SSC Mandarin Group ("SSC"), with 26% owned by a broad based black economic empowerment consortium led by Mr. Ellias Khumalo. SSC has various other mining operating assets in South Africa, specifically in the Northern Cape and Free State provinces.

A phased implementation plan has been proposed by CAPM in respect of the mine. It is expected that it will spend more than R525 million on Mine developments and on erecting a new gold plant at the Mine, in order to restore the operations and prepare the Mine to resume full production within twelve months from the completion date of the agreement.

2011-08-05 17:34:10