21st Sep 2015 08:30
LONDON (Alliance News) - Coal of Africa Ltd Monday said it has raised GBP9.4 million after completing a placing with Yishun Brightrise Investment PTE Ltd and secured an associated USD10.0 million loan to develop the Makhado coking and thermal coal project in South Africa.
The placing and loan were originally announced in August and then approved by shareholders later that month. The GBP9.4 million was raised after Coal of Africa issued 183.2 million shares to the Singapore-based investment company at a premium price of 5.15 pence per share.
Coal of Africa shares were trading down 12% to 3.01 pence per share on Monday morning.
Following the deal, Yishun holds a 9.5% stake in Coal of Africa.
In connection with the deal, Yishun has also provided a USD10.0 million loan to the company which was conditional on the placing being completed.
The proceeds will be used to finance the pre-construction costs of the Makhado coking and thermal coal project. Previously, Yishun has expressed an interest in acquiring a strategic interest in that project and the pair have also discussed the development of the colliery and the award of the engineering, procurement and construction contract for the project.
"The company and Yishun are progressing negotiations to further their potential investment in the project and shareholders will be updated as negotiations between the parties advance," said Chief Executive David Brown.
By Joshua Warner; [email protected]; @JoshAlliance
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