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Wescoal secures funding for R79m MacPhail acquisition

30th October 2013

By: Leandi Kolver

Creamer Media Deputy Editor

  

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JOHANNESBURG (miningweekly.com) – JSE-listed junior miner Wescoal and its subsidiary Blanford on Wednesday announced that it had secured R79-million in funding from Investec Bank, enabling it to acquire MacPhail Distributors’ coal trading business.

Wescoal stated that the acquisition would enable it to attain the critical mass required to negotiate and overcome challenges in the coal-trading environment.

MacPhail has extensive operations across South Africa with seven depots across three provinces and Wescoal expected the acquisition to impact positively on its profit margins.

“This transaction will also afford Wescoal significant synergies, such as cost savings and increased visibility and presence in the marketplace,” Wescoal CEO Andre Boje said.

The coal trading business would fall under Wescoal’s wholly owned subsidiary Chandler Coal, which had, along with Wescoal Mining secured an amount of R100-million from business finance provider Reichmans to fund the working capital requirements of the acquisition.

Wescoal shareholders had until November 18 to approve the R79-million deal, while the Competition Commission was expected to decide on the transaction by November 13.

Edited by Chanel de Bruyn
Creamer Media Online Managing Editor

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