ROCKWELL Diamonds has pressed ahead with its restructuring programme announcing today it had signed an agreement to sell its Remhoogte and Saxendrift mines to private company Nelesco Proprietary 318 for R45m.
The sale and purchase agreement also allows Rockwell to be released from environmental and tax liabilities totalling R99m as well as the transfer of 98 employees.
Remhoogte is held in Pioneer Minerals whilst Saxendrift is contained in Saxendrift Pty (Ltd). However, Rockwell is not selling the limited company as its accounts and purchasing functions are held in it.
As a result of the sale process, Rockwell will book an impairment of some C$1.25m (R13m).
“This transaction represents a significant milestone in our repositioning plans for the ‘new Rockwell’,” said Tjaart Willemse, CEO of Rockwell Diamonds in a statement.
“It not only brings in cash in addition to the recently announced funding by two of the key shareholders and a third party, but also disposes of non-core assets and associated liabilities,” he added.
Rockwell would focus on completing the ramp up of Wouterspan mine and processing plant as well as progress its exploration properties,” he said.
Payment for the assets will be in three tranches of R20m and then R15m on completion of suspensive conditions and registration of the Saxendrift farm in Nelesco’s name. The balance will be paid once other conditions are met including a Section 11 transfer which is a change of control certificate.
Until these conditions are met, Nelesco will operate on a contract mining basis with a royalty payable to Rockwell of 2.5% of revenue from diamonds recovered from the mines. Nelesco will also be responsible for any related rehabilitation.
Wouterspan was back in operation – following a legal challenge by a former contractor – with the aiming of taking Rockwell to production of 200,000 cubic metres a month.
This follows the resignation of James Campbell, Rockwell’s former CEO who has since been appointed managing director of Botswana Diamonds, a company listed on London’s Alternative Investment Market.
Rockwell chairman, Mark Bristow, assisted by a third party, would reinvest in Rockwell Diamonds following the restructuring, the company said on December 7.
