Taung Gold International has announced – on behalf of a new company – it has made a conditional, binding offer to the joint business rescue practitioners of Vantage Goldfields, Makonjwaan Imperial Mining Company and Barbrook Mines to acquire the Lily and Barbrook mines in South Africa.
The shareholders in Newco will be Taung Gold and Siyakhula Sonke Empowerment Corporation (SSC).
Commenting on the offer on behalf of Newco, Taung Gold CEO Neil Herrick says:
“Some of these assets have been in business rescue for over three years and, earlier this year, the original business rescue plans were declared to have failed.
“Given the two mines’ troubled history and the ongoing litigation relating to them, we believe our offer to the BRPs represents a viable alternative to deliver value for key stakeholders relatively quickly through the formulation and implementation of new business rescue plans.”
Herrick said that key conditions of the offer related primarily to the completion of a due diligence, the adoption of new business rescue plans in accordance with Chapter 6 of the Companies Act, and the securing of all necessary regulatory approvals.
The final consideration payable for the assets would be disclosed once the new business rescue plans had been adopted.
On the rationale for Newco and the offer, Herrick says:
“Taung Gold and SSC both like the assets and believe that the potential exists to develop a business that is of value and purpose to its stakeholders and which will include the meaningful participation of the local community and employees.
“Although the relationship between the two Newco shareholders is a recent development, SSC CEO Fred Arendse and I have known each other for some time.
“We recognise the respective qualities of each company’s management and we believe that the relationship is ideally suited to advance our respective and collective interests, given the recent history of the two mines.”