GOLDEN Star, a Toronto-listed gold producer and exploration company operating in Ghana, said La Mancha had completed a $125.7m cash investment buying a 30% stake in the firm and two board seats.
“It will allow us to expedite our exploration and expansion programs at both our Wassa Underground and Prestea Underground Gold Mines as well as providing us with a funding position to participate in the consolidation of the African gold mining sector,” said Sam Coetzer, president and CEO of the company. “It is transformative for our balance sheet.”
La Mancha, which is the investment vehicle for Egyptian entrepreneur Naguib Sawiris, announced on August 2 it was making a move on Golden Star. La Mancha will be issued with about 163.2 million Golden Star common shares.
Sawiris’ best known African gold development is his backing of Endeavour Mining which has grown from a West African minnow into a company with ambitions to produce some 900,000 ounces a year of gold from about 2020. Endeavour Mining recently announced half year results which showed it was on course for production of 555,000 oz to 590,000 oz.
Sawiris launched La Mancha in November and appointed Andrew Wray, the former CFO of Acacia Mining, as its CEO. Acacia was the company with which Endeavour Mining had earlier contemplated a merger before pulling out of the transaction. Said Wray: “Our strategic goal is to create value with a long-term, supportive approach to the benefit of all stakeholders”. Sawiris also developed Evolution Mining, an Australian company which has a stake, incidentally, in South African exploration firm, Orion Minerals.