JOHANNESBURG (miningweekly.com) – Former CEO of embattled Impala Platinum (Implats) David Brown is the new chairperson, with immediate effect, of the currently challenged Coal of Africa (CoAL).
Simultaneously, the ASX-, Aim- and JSE-listed CoAL has raised $44.8-million of equity capital.
Brown replaces Richard Linnell, who has stepped down after 11 years on the board; former Anglo American executive Bernard Pryor has been appointed as a nonexecutive director.
Nonexecutive directors stepping down with immediate effect include Simon Farrell, Steve Bywater and Mikki Xayiya.
Brown, who will be working with CoAL’s stalwart CEO John Wallington, says he is encouraged by the success of the company’s capital raising in the face of the current commodity pricing difficulties.
His key focus will be re-establishing lost shareholder value as the company moves into its next stage of development.
The new equity capital will fund the ramp-up at the Vele Colliery, premining right capital expenditure at the Makhado project and additional drilling activities at the Generaal, Voorburg and Jutland tenements.
Long-suffering investors received the shares at a discount of 1.96% to the closing Aim middle market price of 25.5p an ordinary share.
The placement of 115 478 798 new shares, when combined with the 685 472 236 shares already in issue, will result in a total of 800 951 034 shares in issue, and represent 16.85% of existing issued share capital.
Of the 115 478 798 total new shares, 80 570 166 shares have been placed firm and a further 34 908 632 will be placed with investors subject to shareholder approval on September 11.
The capital injection will boost CoAL’s $11.6-million cash balance to fund the flotation, ultrafines and middlings plant at Vele, the Chapudi acquisition from Rio Tinto and several other projects.
The Makhado definitive feasibility study will be completed in the September quarter with an eye on producing 2.2-million to 2.5-million tons of hard coking coal a year and 0.5-million to 1-million tons of export-grade thermal coal for 16 years.
The formal exercise of right of JSE-listed black-controlled Exxaro to 30% of Makhado has been extended to September 30 to allow for additional studies.
Wallington reiterates that CoAL is a “long-term player with a long-term vision and, step-by-step, we are making that vision a reality”.
Brown joins CoAL after 14 years at Implats; he is also an independent nonexecutive director of Vodacom.
Pryor, until recently Q Resources CEO, is a nonexecutive director of African Minerals and is a former Anglo Ferrous Brazil CEO.
The board will now consist of nine directors, six of them nonexecutive directors.