MC Mining completes sale process of Mooiplaats stake

MC Mining announced the completion of the Mooiplaats Colliery sale process on Thursday, reporting that the DMR had approved the requisite Section 102 application and the first quarterly payment of R11.3m had been received.

The AIM-traded firm had announced in October last year that it had sold its shares and claims in the Mooiplaats thermal colliery for an aggregate purchase price of R179m.

It said the conditions precedent for the transaction were satisfied in November, resulting in the company receiving the initial sale proceeds of R67.0m.

The timing of the 10 equal quarterly payments to settle the remaining balance of R112.9m was scheduled to commence during August 2018, but was dependent on the Department of Mineral Resources (DMR) approving the Section 102 application to, amongst other things, incorporate certain prospecting rights into the colliery's mining right, failing which the payments would be delayed.

“The Section 102 approval was the final requirement to complete the Mooiplaats sales process that commenced during 2013 and is another significant step in the clean-up of the company's balance sheet,” said chief executive officer David Brown.

“The Mooiplaats disposal will result in estimated annual cost savings of R18m and the quarterly payments will be used to develop MC Mining's flagship Makhado hard coking coal project.”