De Beers
Diamond junior Rockwell Diamonds has concluded the sale of its Saxendrift farm, together with rehabilitation liabilities and the transfer of employees to Nelesco 318.

The sale transaction, which includes a cash consideration of C$4.5 million was announced in December last year.

Rockwell Diamonds said the first of three payments of R20 million,  was settled after the fulfillment of certain suspensive conditions.

The second payment tranche of R15 million is due on completion of the registration of the Saxendrift farm in the name of Nelesco, and the balance of R10 million on approval of the section 11 transfer of the mineral properties to the name of Nelesco as well as the consent of the Takeover Regulation Panel of South Africa.

Rockwell Diamonds said the expected impairment of book value of C$1.25 million is now restated as $8.55 million on completion of the transaction.

Nelesco has in the meanwhile completed site establishment and started its mining operations. Until the section 11 transfer is received, all operations will be on a contract mining basis with a royalty payable to Rockwell Diamonds of 2.5% of revenue from diamonds recovered from properties covered by the transaction. Nelesco will be responsible for any related rehabilitation liabilities.

“As regards our repositioning plan we are not in the home stretch yet, says CEO Tjaart Willemse. But we are on the move and gaining traction towards realising the “new Rockwell” goals. Not only have we reduced our liabilities and earned some much needed cash, but we have recovered our operations and regained focus.

“We have a clear strategy, which is to get our Wouterspan mine up to full production and to see first production from our new Stofdraai mine by July. We are also in discussion with an interested party to conduct bulk sampling at the Daniels Alluvials project with a view on developing the site as a JV. We have a focused management team and the recent appointment of a company secretary will provide needed support for our corporate affairs.

“We still have to overcome some remaining challenges, mainly the pending liquidation application lodged by our erstwhile mining contractor and the fact that we are behind on revenue due to inefficiencies in the half completed plant.

“Completion of the final stage of the treatment plant in March will see overall improved processing efficiencies and the ability to generate revenue sustainably.

“I am positive about the future and with the continued support from our shareholders and employees we can ‘make the grade’ and see the new Rockwell Diamonds deliver.”