HomeGoldSimmers share issue raises R110 million

Simmers share issue raises R110 million

The twin shafts
at the new Simmers
acquisition –
the Tau Lekoa
gold mine
Johannesburg, South Africa — MININGREVIEW.COM — 06 March 2009 – Gold and uranium producer Simmer & Jack Mines Limited (Simmers) has raised R110 million to complete the integration of the Tau Lekoa mine into its Buffelsfontein gold mine (BGM), and to fast-track development of its Weltevreden project.

In an announcement here the company said it had successfully placed 49.3 million ordinary shares, equating to 4.65% of its issued share capital and raising R110,514,667.

Simmers had revealed on 18 February 2009 that it had entered into an agreement with AngloGold Ashanti Limited to acquire, as a going concern,  the assets, intellectual property and associated rights to the Tau Lekoa Mine, including the Weltevreden and Goedgenoeg properties for R600 million. The announcement added that this acquisition had established Simmers as a mid-tier gold producer, adding approximately 130 000 ounces per annum to Simmer`s current gold production.

Simmers will be applying the proceeds to fund the following new projects:

  • Tau Lekoa / BGM business integration, specifically the integration of ore-handling
  • capability and logistics from Tau Lekoa to BGM, and integration of all other mine
  • systems – R45-million;
  • Weltevreden feasibility study – R45-million;
  • Goedgenoeg pre-feasibility study – R10-million.

Simmers CEO Gordon Miller commented: "The acquisition of Tau Lekoa is a superb accretive opportunity. It will not only provide an immediate boost to our production profile at average cash costs of $500 per ounce, but it will also provide significant upside in terms of the potential to fast-track production from the neighbouring shallow ore body of Weltevreden, which has the potential to produce an additional 1.5 million ounces over a 12 year period,” he added.