MC Mining says shareholder Kinetic Development Group (KDG), a Hong Kong-listed coal mining and trading company, will be upping its stake in the group.
KDG, which already holds a 13.04% stake in MC Mining, will increase this to 51%.
The investment will provide MC Mining with the funding to develop its Makhado Project, a hard coking and thermal coal project in Limpopo.
The hard coking coal expected to be produced from the project has the potential to become a significant supply to the global steel industry.
As part of the investment, KDG will acquire additional ordinary shares in MC Mining for a total purchase price of about $77m (R1.43bn).
The increased stake will give KDG the right to appoint a majority of MC Mining’s directors, effective from the date of the final instalment payment.
MC Mining, formerly known as Coal of Africa, specialises in coking and thermal coal production. It is listed on the JSE, Australian Securities Exchange and the AIM of the London Stock Exchange.
Besides Makhado, MC Mining’s key projects include the Uitkomst Colliery, a producer of thermal and metallurgical coal in KwaZulu-Natal; Vele Colliery, which produces semisoft and thermal coal in Musina, Limpopo; and the Greater Soutpansberg projects, which produce coking and thermal coal in Limpopo, near Makhado.
The company’s share price has been trading steadily in recent months, with its market capitalisation now at about R455m.
MC Mining’s interim results are scheduled for release on March 14.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.