Chinese make a bid for Aurora gold mines

[] — A Chinese consortium has made an offer for two liquidated gold mines managed on behalf of the liquidators by Aurora Empowerment Systems, which has plans to list the operations.

The offer is shrouded in secrecy.

“I’ve just received an offer, but unfortunately I cannot disclose the identity of the offeror as the offer is subject to strict confidentiality clauses. If the identity is disclosed by the liquidators the offer will lapse,” said Enver Motala, one of the liquidators.

“The reason is that the offeror has not yet received the regulatory approvals from the Hong Kong exchange for this announcement and this process is as a sensitive stage,” Motala said.

Miningmx had two sources saying on Monday that Hong Kong-listed Grand TG, a Western mining firm based in Hong Kong and which has experience of gold exploration, mining and processing in China, was one of the parties to the bid.

Motala declined to confirm or deny whether Grand TG was in the consortium bidding for the two mines which are currently in care and maintenance due to Aurora running short of money.

He also declined any comment on the price the sources suggested, which was $50m for both mines. At the current exchange rate, this equates to R390m.

This is well below Aurora’s offer of R605m for both mines that were owned by Pamodzi Gold before it went into liquidation for debt topping R1.6bn to creditors and suppliers.

“I can’t disclose the quantum of the offer,” said Motala.

“There are numerous conditions attached. The liquidators need to meet and debate these conditions with major secured creditors,” he said.

German bank Unicredit is the major creditor for the East Rand mining operation, which includes the Grootvlei gold mine. South Africa’s Industrial Development Corporation is the major creditor for the Orkney mine.

No further comment will be made on the offer until this process is completed, Motala said.

Aurora, a black-empowerment company, is headed by Nelson Mandela’s grandson Zondwa and Jacob Zuma’s nephew Khulubuse. It also counts as its director Michael Hulley, Jacob Zuma’s lawyer.

Aurora has put in a bid of R605m for both mines, but has yet to pay for them. It has an agreement with the liquidators to manage the mines.

A Malaysian backer, AM Equity, has pulled out of the deal and Aurora has secured a funding agreement with Swiss-based Global Emerging Markets (GEM) to pump in $100m on the successful listing of the two mines on the JSE.

Aurora plans to reverse the mines into Labat, a cash shell on the JSE. The listing is expected around August, Motala has said.

GEM has agreed to a further funding package of $100m that Aurora can draw down on to recapitalise the two mines.