[miningmx.com] — GOLD One International has exceeded its production target for 2011 at its flagship Modder East mine, thereby avoiding a punitive “claw-back’ clause which formed part of its acquisition by China’s Jintu-led consortium.
The company said on Thursday that gold sold during 2011 amounted to 123,179 ounces, exceeding the company’s stated target of 120,000 ounces and reflecting an increase of 85% compared to 2010.
The Jintu transaction was completed on December 29, resulting in an 89.17% shareholding in Gold One by BCX Gold Investment Holdings, a special purpose vehicle formed by the consortium. Apart from offering shareholders A$0.55 per share, giving Gold One an implied value of R4.4bn, the consortium also injected A$150m cash into the company.
CEO Neal Froneman told Miningmx from Hong Kong the confirmation of 2011’s output was one of the remaining loose ends that had to be tied-up in relation to the deal, and that Gold One would issue a new shareholder register soon.
Asked whether he foresaw share liquidity problems – Gold One would retain its listings on the ASX and JSE – given the size of BCX Gold’s stake, Froneman said it could be possible but only over the short term.
“This is not the end-game,’ he said.
When Gold One announced the Jintu transaction in May, Froneman said the backing of the Chinese partners provide a basis for the company to aggressively pursue “internal and external growth’.
The chairman of the China-Africa Development Fund, Mr Zhao, also said at the consortium wished to see Gold One becoming “one of the largest gold companies’ and “to be in the top five within the industry’.
2012 OUTPUT GUIDANCE
Froneman said Gold One would soon provide output guidance for 2012 on Modder East and Rand Uranium. Modder East was earlier predicted to reach peak production of around 170,000oz per year in 2013.
At the time when Gold One pencilled the Rand Uranium transaction in April, Froneman said the company was planning to invest R200m in Rand Uranium’s gold assets during the first 18 months following the acquisition to improve grade and reduce costs, aiming to knock 20% of the current underground operating costs of R1,000/tonne.
The transaction was completed in December following the transfer of the mining right by the department of mineral resources.
Froneman said on Thursday that although the company would first prioritise a solid gold business at Rand Uranium, the envisaged uranium operations would constitute an essential part of realising the potential of the deal.
