Jul 19 2006
BHP Billiton has announced that it has reached agreement to sell Koornfontein Mine (a mine within Energy Coal’s South African portfolio), together with 1.5Mtpa of Richards Bay Coal Terminal entitlement to an entity controlled by a black economic empowerment consortium. The consortium, which will hold 50% plus one share in the new entity, is led by Siyanda Resources (Pty) Limited and Aka Resources Holdings (Pty) Limited, and includes various broad based groups as well as a Koornfontein employee trust. Coronation Capital Limited, a wholly owned subsidiary of Coronation Fund Managers, and Investec Bank Limited will together hold 50% less one share in the new entity.
In addition to a cash consideration, payable after all the conditions precedents have been achieved, BHP Billiton will receive further compensation for potential future Eskom coal sales. The aggregate consideration in current money terms is approximately US$ 75M. The completion of the sale is subject to, inter alia, the conversion and transfer of Koornfontein’s mining rights in terms of the Minerals and Petroleum Resources Development Act of 2002 and the approval of the South African Competition Commission.
Mahomed Seedat, President Energy Coal, said “We are happy to have found in the Siyanda Aka consortium a purchaser for Koornfontein which has a significant black mining professional component and which will continue to extract value from the mine for a number of years to come and increase the sustainability of the asset. The sale is consistent with company’s strategy of continually reviewing its portfolio mix and focussing on long life, low cost assets. We are also extremely pleased to be furthering BEE ownership and involvement in the coal sector and RBCT”.
Koornfontein Mine is situated 200 kilometres east of Johannesburg in Mpumalanga province. It supplies energy coal to the export markets. The mine produced 3.6 million tonnes of saleable export quality steam coal in the twelve months to June 2005 and has a workforce of some 800 employees and 600 contractors. Koornfontein Mine is 100% owned by BHP Billiton.
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