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Chinese may buy out Pamodzi

Pamodzi’s Orkney
Johannesburg, South Africa — MININGREVIEW.COM — 31 July 2009 – Pamodzi Gold’s management may have secured Chinese backing for a management buyout of its Orkney and East Rand mines, which are currently in the hands of provisional liquidators.

Pamodzi’s management declined to comment and one of the liquidators, Enver Motala, said he would neither confirm nor deny it, reports Fin24.com, quoting Miningmx.com.

“There are so many rumours in the market that we don’t comment on them,” said Bongi Radebe, the corporate affairs executive at Pamodzi Gold.

The story is that management of Pamodzi, which is suspended from trading on the JSE, is in talks with the China Africa Development Fund (CADF) to back their bid to buy two of the three assets for which the liquidators have not yet found buyers

A reliable source told Miningmx the process had advanced to the point of engaging the provisional liquidators, who in turn have passed the proposal on to Standard Bank for further talks, but again there was no confirmation from Motala on the point.

Miningmx says a second source confirmed that CADF, which has funds of US$5billion (R40 billion) to invest in Africa, had been sent Pamodzi’s way by the Industrial Development Corporation, which has extended loans of some R260 million to the gold company. The source could not say what, if any, progress had been made.

Falling outside the possible agreement would be the Free State assets, including the President Steyn mine, for which Harmony Gold has been selected as the preferred bidder.

The legal agreements for the sale of the assets to Harmony by the liquidators are about a week away from being signed.