Coal of Africa extends date on Mooiplaats sale
Coal of Africa (CoAL) said Wednesday it has extended the sale deadline for Blackspear Holdings Proprietary Ltd to meet the necessary conditions to purchase the Mooiplats colliery, mothballed in October 2013.
The cash-strapped company also revealed a restructuring of the capital raise announced in August.
"Despite the delay in the completion of the sale of Mooiplaats, both Blackspear and Coal of Africa are confident that the transaction will complete on the terms originally reported," said Chief Executive David Brown.
CoAL has been raising funds through the disposal of various non-core assets. The sale of its Mooiplaats colliery, in the works for some time, is now expected to be completed in the first quarter of 2015, he added.
Both Mooiplaats sale and the capital raise are crucial to the success of CoAL’s “turnaround strategy,” which is to get its re-designed Vele colliery back into operation and then raise funds for the development of Makhado, crucial for the miner’s long-term future.
CoAL also needs to pay $30 million owed to Rio Tinto (LON:RIO) for the acquisition of the Chapudi coal tenements in Limpopo Province, which is now overdue.