Johannesburg, South Africa — MININGREVIEW.COM — 15 July 2010 – Aurora Empowerment Systems could be thrown a R50 million lifeline by the end of this week, reports Miningmx, citing joint provisional liquidator of Pamodzi Gold, Enver Motala.
Aurora’s new backer “’ the Swiss-based alternative investment firm Global Emerging Markets (GEM) “’ has agreed to extend the funds once Labat Africa (LAB) confirms that it has become Aurora’s controlling shareholder. This will be consummated on acquisition of a 45.7% stake in Labat, effectively a reverse takeover.
The company is expected to pay for the stake this week, with Labat likely to make a formal announcement once the deal has been finalised, says Miningmx.
Motala said the money would allow Aurora to pay its wages, creditors and for care and maintenance of the Orkney and Grootvlei mines, previously owned by the liquidated Pamodzi Gold. It should be enough to carry Aurora for the next three months, taking it beyond the end of September when it is expected to complete all the regulatory approvals related to the Labat deal.
Once the deal has been completed, GEM will release the R725 million in funding it has promised Aurora. This money will be used to secure its purchase of the mining assets.
GEM has also agreed to provide a further R725 million to pump back into the assets to make them work. “It looks very encouraging,” said Motala, who has been chasing Aurora for payment since it was named the preferred bidder for the assets late last year.
Meanwhile Motala said the Chinese consortium that had expressed an interest in the asset was busy completing a competent person’s report. This report might result in a firm offer from the consortium, he said, indicating that a race was still on to see which company would be the first to put the funding on the table.