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The sale of shares and issue of new shares in Wescoal to its new black economic empowerment investors will result in a BEE shareholding of 32,5 percent.
The coal trader said in a statement to the JSE yesterday that its main shareholders, including its directors, had agreed to sell 33 million shares to Waterberg Portion Property Investments (WPP) for R35,5 million.
Wescoal has also agreed to issue a further five million shares to WPP at R5,3 million.
"The company's enhanced BEE profile is expected to result in an increase in business from its current customers and to assist in its drive to expand its mining operations," Wescoal said.
Wescoal's financial director, Piet van Rensburg, said the deal was a win-win for both companies.
He said: "Apart from the contracts that we can now tender for with various government departments, we will also gain access to various coal reserve mining rights obtained by our BEE partners in the Waterberg and KwaZulu-Natal regions.
"We made it public a long time ago that we intended to go into mining ourselves and our partners will assist us with obtaining mining licences."
Wescoal said the cash raised would be used to pay for its acquisition of the coal businesses of Express Technology and Atlantis Coal, as well as for working capital requirements.
WPP participated in the Khumama consortium that sold 50percent of the Booysendal platinum project to Mvelaphanda Resources as well as part of the BEE consortium of Eland Platinum Holdings. The BEE company is also the majority owner of Vuselela Mining, which holds several mineral rights for platinum, manganese, iron ore and coal.
These coal rights are located in Mpumalanga, Waterberg and KwaZulu-Natal.
"The vision is to prospect these rights and ultimately to sell them into Wescoal in line with Wescoal's stated strategy to source its own coal reserves in the medium term," the company said.
Van Rensburg said WPP obtained the coal mining rights from the Department of Minerals and Energy after a successful application.
He said legislation changes in 2002 meant all coal reserve rights went back to government, which meant companies needed to obtain coal mining licences from the department for access. - I-Net Bridge. Additional reporting by Xolile Bhengu