Tau Lekoa acquisition to boost Simmers’ basic profit
miningweekly.com
By: Esmarie Swanepoel
21st April 2009
JOHANNESBURG (miningweekly.com) – Gold and uranium producer Simmer & Jack mines (Simmers) has reported that the acquisition of the Tau Lekoa mine from AngloGold Ashanti, and the sale of 19,6-million shares in Canada’s First Uranium, would increase its basic profit a share by 162%.
Basic loss a share for the six months ended September 2008 was recorded at 16,97c a share, and pro forma financial estimations were that basic profit a share would rise to 10,51c a share with the completion of the two transactions.
Simmers stated on Tuesday that its agreement with AngloGold Ashanti was to acquire, as a going concern, the assets, intellectual property, and associated rights to the Tau Lekoa mine for a consideration of R600-million.
Simmers has agreed to pay a 3% gross revenue royalty to AngloGold Ashanti on a quarterly basis, which was payable on all gold produced by the sale assets and sold at an average price exceeding R180 000/kg a quarter from January 1, 2010. This royalty has not been included in the financial effects.
Moreover, the royalty will not apply to gold sold at an average price below R180 000/kg a quarter and would cease to apply once it has been paid in respect of 1,5-million ounces of gold produced by the sale assets.
Simmers’ sale of 19,6-million First Uranium shares, in a transaction led by the Royal Bank of Canada’s Capital Markets, was to raise gross proceeds of C$90,16-million. The proceeds from the sale would assist in financing debt from the Tau Lekoa acquisition. |
