Village Main Reef’s Consolidated Murchison (Cons Murch) has declared that it is in position of being “distressed” and the board of directors have placed the company under “Business Rescue” in terms of Section 129 of the Companies Act.
The Cons Murch mine is an antimony and gold mine at Gravelotte in Limpopo province, South Africa and has been in need of capital injection to fund activity and maintain cash flow.
Village Main Reef fails to sell shares in Cons Murch
Village Main Reef had agreed to sell its 74% shares in the company to Australian based miner Stibium Mining, however the purchaser was unable to raise the funding required. The negotiations had been on-going for the past year but collapsed on December 10th 2014.
Village resolved at that stage that it was unable to continue funding its subsidiary and the board of directors at Cons Murch have told shareholders that it cannot pay demands for immediate payment for expenses.
Cons Murch board confident of rescue plan succeeding
The board believes there are reasonable prospects for rescuing Cons Murch as the assets when fairly valued exceed the liabilities and the resolution of moving to business rescue status, is being filed with the company’s Intellectual Properties Commission. The board believe that a rescue plan, when implemented, will optimise the likelihood of Cons Murch continuing as a going concern.
The Department of Mineral Resources has been consulted and has indicated a willingness to consider the application on merit.
Cons Murch has a 1.35 million ounce gold equivalent life of mine reserve deposit. The mine produces antimony and gold from its three operating shafts, Athens, Monarch and Beta. It is one of the largest global producers of antimony outside China and is situated on one of the largest known antimony ore bodies in the world.