ResGen owned 70% of WOC, but has completed a transaction with Lukale Mining Company to increase this ownership to 74%, in line with its ownership of its other subsidiary Ledjadja Coal.
Under the agreement, WOC will be owned 74% by ResGen and 26% by Fairy Wing Trading, the black economic-empowerment partner of Ledjadja Coal.
FWT is being lent R39 million on commercial terms by ResGen to fund its acquisition of the WOC shares
Lukale will receive R25 million in ResGen shares at 40c per share, subject to shareholder approval at the forthcoming annual general meeting, as well as a R20 million cash payment.
The shares will be held on the South African register and be eligible for sale on the Johannesburg Stock Exchange.
Ledjadja Coal owns the mining right for the Boikarabelo mine adjacent to WOC’s main prospecting right, Waterberg One.
Waterberg One contains an indicated resource of 1116.4 million tons and a measured resource of 865.5Mt, including a probable reserve of 314.2Mt.
“This ownership change and alignment will enable a practical consolidation of our mining tenements to occur and make it easier to manage the operations of Boikarabelo,” ResGen managing director Paul Jury said in a statement.
“Our expectation is to open a separate pit at Waterberg One to supply domestic grade coal to Eskom and the independent power stations intended to be developed by Valu Investments Pte Ltd.”