Wescoal Holdings agrees to sell Intibane colliery for R57m

WESCOAL Holdings is to sell its Intibane colliery for R57m as part of a strategy of disposing non-core assets. Negotiations to sell another non-core asset were underway, the company said today in an announcement.

“The remaining coal reserve at the Intibane Complex being less than the annual production rate, the disposal is in line with the company’s strategy of realising value for shareholders and building a scalable sustainable business,” it said.

The transaction, which is to private business called Tokata Resources and Banjosign Proprietary, will become effective on July 1.

Tokata Resources will pay R39m for the mining operations and assets of Intibane Complex and R18m is payable by Banjosign for the surface rights of the asset. Wescoal valued the net assets at R39m and attributable profits at some R37m for the year ended March 30. Earlier this week, Wescoal announced headline share earnings for the financial year of 46.6 cents which was 311% higher year-on-year. “It’s been an exceptional year,” said Waheed Sulaiman, CEO of Wescoal.

Proceeds from the sale would be used to pay down short-term borrowings and help fund strategic acquisitions that the group is considering.