Bushveld Minerals Limited, the diversified mineral development company with a portfolio of vanadium, titanium, iron ore, tin and coal assets in Southern Africa, has completed the change in ownership of Vametco Holdings Black Economic Empowerment (BEE) partners.
Further to the Company’s announcement on 22 February 2017, Bushveld also confirmed that Jaxson 640 completed the acquisition of the Avacap Consortium’s interest in Vametco and will now replace the Avacap Consortium as major BEE partner to Strategic Minerals Corporation. Jaxson 640 together with the local communities, on whose land the Vametco mine deposit and processing plant are located, will now hold a 26% shareholding in Vametco.
Under the terms of the acquisition, as previously announced, Jaxson 640 agreed to purchase the Avacap Consortium’s interest in Vametco for a total sum R 8,522,103, comprising a purchase consideration of R5,000,000, the settlement of a shareholder loan, with interest, of R2,000,000 principal and an additional R1,000,000. In addition, Jaxson assumed its share of the existing debt of approximately R39.5 million historically incurred in establishing the existing BEE shareholding in Vametco.
The Company confirmed that this transaction is now complete. Furthermore, the Company announces that it has reached a vendor funding agreement with Jaxson 640 in terms of which Bushveld has provided to Jaxson 640 funding totalling ZAR 8,522,103 (US$ 655,189) to enable it to complete the transaction. The funding has been provided in the form of a vendor loan and will be repaid to Bushveld from dividends due to Jaxson 640 from Vametco over a period of 5 years.
As announced on 28 March 2017, Bushveld entered into the Gingko Agreement in terms of which Bushveld would replace Gingko as lender to the BEE shareholders of Vametco. Accordingly, Bushveld has paid Gingko a total of R7,677,983.49.
The total outlay by Bushveld in respect of the BEE transaction was R16,200,087.
Pursuant to the completion of the Jaxson BEE transaction, the directors representing the Avacap Consortium on the boards of directors of Vametco and Vametco Alloys have since resigned and will be replaced by Jaxson 640’s representatives.
Jaxson 640 is led by Bill Chipane, an investment professional with more than ten years in the metals and mining investment banking experience. Mr Chipane is well known to Bushveld Minerals and has been a consultant to the group for some time.
Fortune Mojapelo, CEO of Bushveld Minerals, said they were delighted to announce, now that all the conditions have been satisfied, that the Jaxson 640 transaction Bushveld supported and vendor financed is now complete. “We are pleased to have the Jaxson 640 team and the local land-owners and communities, who are beneficiaries of this transaction, as our partners at Vametco and look forward to working with them in future,” he said.