LONDON (Alliance News) - Jubilee Platinum PLC on Friday said it has received the majority of the consideration for the sale of its Middelburg operations and said it will receive the outstanding balance over the next 12 months.
At the start of October, Jubilee completed the sale of the Middelburg smelter and power plant in South Africa to Siyanda Resources Proprietary Ltd for a total of ZAR110.5 million, around GBP5.3 million.
On Friday, Jubille said it has recieved 85% of the total consideration, with the other 15% being held in escrow. The escrow funds will be released following two warranty periods, with 10% of the total consideration to be released in 90 days time and the remaining 5% after 12 months.
"Receipt of the cash payment for the transfer of ownership and related risks of the Middelburg operations now concludes the disposal. The proceeds from the disposal together with debt funding being concluded with a major institution and, for which credit committee approval has already been secured, will be used for the simultaneous execution of our two platinum surface projects," said Chief Executive Leon Coetzer.
"Jubilee is now set to becoming a fully operational platinum producer in 2016 on the back of two robust surface platinum projects offering significant earnings potential to the company," Coetzer added.
The miner struck the deal in mid-July, when it agreed to sell the non-platinum assets to Sibanya through Main Street 1347 Pty Ltd, a special purpose vehicle created to acquire the assets.
Sibanya has acquired Jubilee Smelting and Refining Pty Ltd, a subsidiary which owns the Middelburg smelter complex, and Power Alt Pty Ltd, which owns the power plant at the site.
Jubilee retain the right to construct a five-megawatt platinum furnace at the Middelburg site in the future and also has the right to participate in any expansion of the power plant at the site.
Jubilee shares were trading up 5.2% to 4.07 pence per share on Friday afternoon.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
Copyright 2015 Alliance News Limited. All Rights Reserved.
Jubilee Metals (JLP)