DRDGOLD has agreed to sell 60percent of its troubled Blyvoor Gold Mine to Aurora Empowerment Systems for R296million, effective December 1.
DRDGOLD said Aurora would provide Blyvoor with a capital facility of up to R80million, of which the mine would be able to draw down R10million by the end of December and up to R14million each month-end thereafter until the end of May next year. "(The facility) will provide immediate relief to Blyvoor in terms of its short-term working capital requirements," said DRDGOLD chief executive Niel Pretorius.
He said Blyvoor had increased gold production by 116percent between October and November, and the rand per kilogram gold production cost had dropped by 47 percent.
"This substantially improves prospects for bringing Blyvoor out of its current judicial management, sooner rather than later," he said.
DRDGOLD said shareholders should exercise caution when trading in DRDGOLD securities until a full announcement was made.
Aurora is headed by Nelson Mandela's grandson Zondwa Mandela, who is the managing director, and President Jacob Zuma's nephew Khulubuse Zuma, who is chairperson. - Reuters