Wescoal to buy coal trader for R79m
JSE-listed junior miner Wescoal has moved to acquire a coal trading business from an undisclosed third party for R79-million in property, movable assets and goodwill.
The acquisition, through Wescoal’s wholly owned subsidiary, Chandler Coal, was expected to provide the group’s trading arm with sufficient critical mass to negotiate and overcome competition and volume challenges.
Further, the purchase of the coal business will enable Chandler to generate significant synergy savings and profits, thereby enhancing Wescoal’s earnings and shareholder value.
The undisclosed third party’s coal supply business operates within Southern Africa, with offices and depots located in Gauteng, the Eastern Cape and the Western Cape.
The deal is expected to be completed by October 31, subject to conditions, including the conclusion of a legal and financial due diligence investigation; share- holder approval; the necessary regulatory approvals; and Chandler being able to secure funding for the acquisition, besides others.
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