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Xceed Resources has signed an MoU with South Africa’s Thebe Mining Resources to sell a cornerstone stake in its Moabsvelden coal project for AUD 11 million (US$112.90 million)
The transaction will enable Thebe to hold a 30 per cent interest in the thermal coal project and become a substantial shareholder in Xceed.
Xceed would move to buy back the 26 per cent shareholding, currently owned by its existing Black Economic Empowerment (BEE) shareholders, with a series of cash payments starting within six months. The cash payments would be made over a four-year period.
“The company enjoys an excellent relationship with our existing BEE partners and wishes to pursue further investments in the South African mining sector with them in the future,” said Xceed managing director Ian Culbert.
“We are gratified that our existing partners have recognised the significance of the proposed investment by Thebe in the context of current market conditions and have agreed to dispose of their interest in the project.”
Culbert added that the restructuring of the project ownership would contribute financially to the future development costs of the project and as the investment was primarily at the project level.