adminas part of implementation of a memorandum of understanding signed with Government in terms of the indigenisation and empowerment regulations.
Under the MOU, signed in February, Caledonia is to sell 15 percent of shares in Blanket mine to indigenous Zimbabweans, 10 percent will be sold to the Blanket Mine Employee Trust, 16 percent will be sold to the National Indigenisation and
Economic Empowerment Fund and 10 percent will be donated to the Gwanda Community Share Ownership Trust. Caledonia will also make a non-refundable donation of $1 million to the trust as soon as it has been established.
In a statement accompanying the corporation’s financial results for the first quarter, Caledonia said it had entered into a agreement to sell shares to Flemiro Investments for $11 008 million.
The corporation would provide funding for the purchase of the shares which would be repaid from future dividends.
Completion of the agreement is subject to regulatory approval from the Reserve Bank of Zimbabwe and Caledonia receiving confirmation from the Government that full implementation of the terms of the MoU constitutes compliance by Blanket and Caledonia with the requirements of the Indigenisation Act.
“The first transaction for the sale of 15 percent of Blanket to Flemiro Investments, a Zimbabwean-registered investment company, which has been incorporated to represent a diverse group of Indigenous Zimbabweans, for a consideration of $11 008 million, has been signed.
“Caledonia will facilitate the vendor funding of this transaction which will be repaid by way of future dividends from Blanket. The timing for the repayment of the facilitation loans will depend on the future financial performance of the Blanket Mine.
“Caledonia expects to redeploy the sale consideration in its projects,” said the statement.
Caledonia said documentation for the formation of employee trust and sale of a 10 percent stake in Blanket mine to the trust had been finalised and the transaction was expected to be concluded shortly.
“Caledonia has submitted agreements to the parties concerned regarding the remaining two transactions pursuant to the MoU being the sale of a 16 percent interest to the National Indigenisation and Economic Empowerment Fund and the donation of a 10 percent interest to a Gwanda Community Share Ownership Trust and their responses are awaited.”
The company said it posted an after tax profit equivalent to $7 090 084 compared to $1 364 973 in the preceding quarter.
Gold production at Blanket Mine fell 13 percent to 9 164 ounces compared to 10 533 ounces in the fourth quarter of 2011.
Caledonia attributed the lower gold production to scheduled maintenance on the No. 4 Shaft.
Payment by Blanket Mine to the Government in the form of direct and indirect taxes, royalties, licence fees, levies and other payments fell to $3 282 000 from $5 024 000 the prior quarter.
Online Reporter