Base metals miner Assore and diversified miner African Rainbow Minerals (ARM) have reached a definitive agreement on the acquisition of ARM’s 50% indirect interest in the Dwarsrivier chrome mine for R450 million.
The transaction which will result in Assore owning 100% of Dwarsrivier.
Dwarsrivier is presently owned and operated by Assmang, the equal joint venture between ARM and Assore. Dwarsrivier mines chrome ore near Lydenburg in the Mpumalanga province. The ore produced is sold both on the export market and locally.
In order to effect the transaction, Assmang will sell Dwarsrivier to K2011105280 Pty Ltd, a special purpose company (Dwarsrivier SPV), in which Assore will, pursuant to the implementation of the transaction, own the entire issued share capital.
Assore has also further agreed to refund any amounts advanced to Dwarsrivier by Assmang between 1 July 2014 (being the effective date) and the implementation date of the transaction up to a maximum amount of R800 million. In addition, any cash profits earned by Dwarsrivier between these two dates will be transferred to Dwarsrivier SPV as part of the transaction.
Ministerial consent will need to be obtained for the transfer of the Dwarsrivier mining right from Assmang to Dwarsrivier SPV in terms of Section 11 of the Minerals and Petroleum Resources Development Act.