21st Jan 2020 11:32
(Alliance News) - Caledonia Mining Corp on Tuesday said it has increased its holding in the Blanket gold mine in Zimbabwe to 64%.
Caledonia, which previously held 49%, first announced the deal in November 2018 but it required approval from various regulators in the country, which took over a year.
The miner will be paying USD16.7 million to partner Fremiro Investments Pvt Ltd. Caledonia is paying in both shares and the cancellation of a loan between Fremiro and Caledonia. Fremiro will have a 6.3% stake in Caledonia following the sale.
"I am pleased to report the company has concluded its transaction with Fremiro to increase Caledonia's shareholding in Blanket to 64%," said Caledonia Chief Executive Steve Curtis.
"I would like to thank Fremiro for its support as a shareholder in Blanket during the last seven years and am confident that Fremiro, now as a significant shareholder in the company, will continue to be supportive of Caledonia's business going forward."
Caledonia originally sold 41% of the Blanket mine to indigenous Zimbabwean shareholders in 2012 to meet economic empowerment laws. Fremiro got 15%, the National Indigenisation & Economic Empowerment Fund 16%, and the Blanket employee trust 10%.
Another 10% was donated to the local community via the Gwanda Community Share Ownership Trust, leaving Caledonia with a 49% stake and local shareholders with 51%.
However, in March 2018 the law was amended, removing the need for 51% of gold mining business to be Zimbabwean-owned.
Shares in Caledonia were 0.5% lower on Tuesday morning in London at 651.75 pence each.
By George Collard; [email protected]
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