AURORA FINALLY GETS FUNDING

AURORA Empowerment Systems has concluded a deal to get funding of as much as R1,45billion to bring its beleaguered gold mines back to life.

AURORA Empowerment Systems has concluded a deal to get funding of as much as R1,45billion to bring its beleaguered gold mines back to life.

This comes amid yet another crisis in a string of crises for the company. The National Union of Mineworkers (NUM) announced yesterday that over 2000 workers at Aurora's Grootvlei mine on the East Rand were without water after the water supply was cut off on Wednesday.

"The beleaguered company, that has this morning announced that it has received multi-million funding from foreign investors, is yet to pay its workforce as well as water bills," NUM said.

"They could have first restored water and electricity and paid their workers before going to the media to glorify their so-called achievement."

Earlier yesterday, Aurora announced that Global Emerging Markets (GEM), a Swiss-based alternative investment group, has committed to subscribe for new shares in a listed company (Labat Africa) currently being bought by Aurora.

Aurora made the announcement at a press conference where no representatives of GEM were present.

Michael Hulley, one of Aurora's directors, said a letter had been sent to the liquidators of the mines that Aurora bought last year. Aurora was unable to fund the project after its previous funder, Malaysian AM Equity, pulled out. Joint liquidator Enver Motala confirmed yesterday that he has received a letter - directly from GEM - and that it looked encouraging.

Aurora indicated that GEM would subscribe for shares in the new listed entity up to R725million, but the deal also allows for GEM to increase credit to Aurora up to R1,45billion.

Motala said the R725million would cater for the full purchase price of the mines Aurora bought. Last year, Aurora was announced as the preferred bidder for Pamodzi Gold's provisionally liquidated Orkney mine, for R215million, and its East Rand operations (including Nigel, Consolidated Modderfontein and Grootvlei) for R390million.

Motala said the balance would be used for capital expenditure.

Motala said while the letter was encouraging, the liquidators have asked for the agreement between Aurora and GEM to make sure there are no conditions which could derail the process.

At the same time, the liquidators are continuing with their negotiations with the Chinese investors, who are waiting in the wings should the Aurora funding plan not materialise.

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