MCM raises R15m from ABSA for Uitkomst equipment recap

MC Mining (MCM) has raised R15m in debt which it will use to buy new underground mining equipment for Uitkomst, a KwaZulu-Natal province thermal coal mine it bought from Pan African Resources in 2017 for R275m.

On August 2, the company said it had bought the contracting company at Uitkomst – Khethekile Mining – for R65m including 340 Khethekile employees working at the colliery and at Khethekile’s Newcastle offices. The debt was raised from ABSA Bank Ltd, one of South Africa’s largest commercial and retail banks.

The facility is subject to a floating coupon at the South African prime rate, currently 10% annually, plus 0.5%, and is secured by the mining equipment purchased. “The ABSA facility reflects the growing confidence that financial institutions have in MC Mining and the execution of our strategy,” said David Brown, CEO of MCM.

“The acquisition of new mining equipment and integration of the recently acquired underground mining operations will result in improved equipment availability and contribute to the production enhancement initiatives at the colliery, ensuring Uitkomst is positioned to benefit from prevailing higher international coal prices,” he said.