PERTH (miningweekly.com) – South Africa-focused coal miner Universal Coal has acquired the Arnot South thermal coal project from South Africa’s largest listed coal miner Exxaro for A$9.45-million.

The Arnot South project is located some 50 km from Universal’s New Clydesdale Colliery (NCC) and covers some 15 212 ha. Historical drill data suggests the project has a Joint Ore Reserves Committee-compliant resource of some 97.7-million tonnes.

“The acquisition of Arnot South increases Universal’s thermal resource base by 25%, further strengthening our position in the Witbank coalfield, South Africa’s most important source of thermal coal,” said Universal CEO Tony Weber.

“With Kangala having achieved steady-state operations at 2.8-million tonnes a year run-of-mine, and the two-million-tonne-a-year NCC expected to be in full production in the latter part of this year, Universal is now pursuing coal ventures capable of supporting larger, longer-term operations.”

Weber said the Arnot South project not only met this requirement, but also hosts excellent quality coal that would allow processing flexibility and would offer coal production optionality.

“The acquisition marks another key step towards growing the company into a sustainable midtier coal producer in the medium term.”

Meanwhile, Universal on Tuesday also released a formal response to a takeover offer by shareholder IchorCoal, along with an independent expert report which has deemed the offer neither fair nor reasonable.

Ichor, which already held a 29.99% stake in Universal, on October 1, officially launched its takeover bid and was offering Universal shareholders A$0.16 a share in cash.

Universal has maintained that the offer was inadequate and did not represent the inherent value of the company, pointing out on Tuesday that the independent expert had valued Universal’s shares at between A$0.26 and A$0.34 each.

The takeover target had again called on shareholders to reject the IchorCoal offer.