MC Mining secures R20 million working capital loan from a shareholder
MC Mining announced on Friday that it had secured a R20 million loan facility from Dendocept Proprietary Limited, which holds approximately 6.8% of the company.
The funds from the loan will be used to support the mining group's working capital needs.
MC Mining, formerly known as Coal of Africa, is engaged in the development and mining of high-quality thermal and coking coal in South Africa.
The R20 million from Dendocept will be managed under MC Mining's wholly-owned subsidiary and group administration company, GVM Metals Administration.
"The facility is available for a period of 12 months from the first drawdown and must be repaid by the end of this period," the company stated.
"Interest will be paid monthly, calculated at the prevailing Investec South Africa prime interest rate (currently 11.75%) plus a margin of 3%."
The loan facility is unsecured, supported by guarantees from MC Mining.
Mathews Senosi, MC Mining's interim chairman, said the loan facility reflects ongoing shareholder commitment to support the coal miner.
"The company is assessing its corporate and Limpopo project operational and overhead costs, as well as the resources needed to advance its collieries, development, and exploration projects, including the flagship Makhado shovel-ready steelmaking hard coking coal project," Senosi explained.
Recently, Georgia-based Goldway Capital acquired MC Mining, concluding a contentious takeover process marked by heated exchanges and accusations of falsifying corporate information between the boards of the two companies.
Last week, MC Mining announced the appointment of Yi Christine He as interim managing director and chief executive, effective immediately, following the resignation of Godfrey Gomwe.
For the year ending March, MC Mining's run-of-mine (ROM) coal production from the Uitkomst steelmaking and thermal coal mine increased by 14% compared to the same period in 2023, reaching 115,909 tons.
Quarterly sales from the Uitkomst asset totaled 75,590 tons of high-grade coal.
There were limited activities at the Makhado steelmaking hard coking coal project during the same period, while the downscaling of operations at the Vele Aluwani Colliery was completed in January.
The company noted depressed international thermal coal prices, with average API4 index prices of $97 (over R1,700) per ton for the three months ending March 2024, compared to $116 per ton previously.
However, premium steelmaking hard coking coal prices "remained elevated," averaging $312 per ton for the quarter compared to $280 per ton previously.
"The takeover process adversely impacted the progress of the Makhado Project, including the suspension of early works and early coal initiatives, as well as the managed tender processes for selecting and appointing outsourced mining, plant, and laboratory operators at Makhado," the company previously stated.
Goldway Capital's takeover also halted funding activities for the development of the project, although activities for Makhado are expected to resume soon.
The funds from the loan will be used to support the mining group's working capital needs.
MC Mining, formerly known as Coal of Africa, is engaged in the development and mining of high-quality thermal and coking coal in South Africa.
The R20 million from Dendocept will be managed under MC Mining's wholly-owned subsidiary and group administration company, GVM Metals Administration.
"The facility is available for a period of 12 months from the first drawdown and must be repaid by the end of this period," the company stated.
"Interest will be paid monthly, calculated at the prevailing Investec South Africa prime interest rate (currently 11.75%) plus a margin of 3%."
The loan facility is unsecured, supported by guarantees from MC Mining.
Mathews Senosi, MC Mining's interim chairman, said the loan facility reflects ongoing shareholder commitment to support the coal miner.
"The company is assessing its corporate and Limpopo project operational and overhead costs, as well as the resources needed to advance its collieries, development, and exploration projects, including the flagship Makhado shovel-ready steelmaking hard coking coal project," Senosi explained.
Recently, Georgia-based Goldway Capital acquired MC Mining, concluding a contentious takeover process marked by heated exchanges and accusations of falsifying corporate information between the boards of the two companies.
Last week, MC Mining announced the appointment of Yi Christine He as interim managing director and chief executive, effective immediately, following the resignation of Godfrey Gomwe.
For the year ending March, MC Mining's run-of-mine (ROM) coal production from the Uitkomst steelmaking and thermal coal mine increased by 14% compared to the same period in 2023, reaching 115,909 tons.
Quarterly sales from the Uitkomst asset totaled 75,590 tons of high-grade coal.
There were limited activities at the Makhado steelmaking hard coking coal project during the same period, while the downscaling of operations at the Vele Aluwani Colliery was completed in January.
The company noted depressed international thermal coal prices, with average API4 index prices of $97 (over R1,700) per ton for the three months ending March 2024, compared to $116 per ton previously.
However, premium steelmaking hard coking coal prices "remained elevated," averaging $312 per ton for the quarter compared to $280 per ton previously.
"The takeover process adversely impacted the progress of the Makhado Project, including the suspension of early works and early coal initiatives, as well as the managed tender processes for selecting and appointing outsourced mining, plant, and laboratory operators at Makhado," the company previously stated.
Goldway Capital's takeover also halted funding activities for the development of the project, although activities for Makhado are expected to resume soon.
