JOHANNESBURG (miningweekly.com) – Dual-listed precious metals mining group Pan African Resources has completed the acquisition of Uitkomst colliery from investment holdings company Oakleaf Investment Holdings and minerals company Shanduka Resources for a revised purchase consideration of R176-million.

Pan African assumed effective control of Uitkomst colliery on April 1 after settling on the new amount, as well as a total net purchase consideration – inclusive of working capital acquired – of about R150-million, compared with the R200-million initially announced in June, 2015.

“We are pleased to have finalised the transaction and we welcome the Uitkomst colliery employees to the group,” commented Pan African CEO Cobus Loots, adding that the transaction was expected to be value accretive to Pan African, as previously communicated.

Pan African further revealed on Monday that Uitkomst colliery would be implementing a black economic-empowerment (BEE) transaction similar to those currently in place at its Barberton and Evander mining operations.

The BEE transaction would increase the historically disadvantaged on-mine ownership in the Uitkomst colliery by 9%, which would be held by broad-based trusts and by a strategic entrepreneur’s trust.

The BEE transaction would be financed by the Uitkomst colliery on a notional basis, with this notional funding accruing interest linked to the prime interest rate.

This transaction would result in limited dilution to Pan African and 80% of the dividends issued to the BEE shareholders would be retained to repay the notional funding over ten years.

UITKOMST OPERATIONS
Uitkomst colliery had an average run-of-mine of 50 000 t/m and average saleable coal production amounting to 34 000 t/m.

With a 28-year life-of-mine, the colliery's staff complement comprised 110 plant employees and 300 contractors. Its approximate sustaining capital was R10-million a year, and its profit and cash flow (after taxation) was between R30-million and R35-million a year.