Caledonia Mining Corporation, the parent company of Blanket Mine, has concluded agreements to transfer 20% to two local trusts.
This comes two weeks after the mine disposed a 15% stake to a consortium of local investors, Flemiro Investments, for $11 million as part of its indigenisation compliance implementation plan.
In a trading update yesterday, Caledonia said the agreements were in line with the memorandum of understanding (MoU) signed with the government, which will result in locals acquiring an effective 51% ownership of the Blanket Mine for a paid transactional value of $30,09 million.
“An agreement has been signed for the sale of 10% of Blanket for a consideration of $ 7,339 million to the Blanket Mine Employee Trust that has been established for the benefit of the present and future managers and employees of Blanket” Caledonia said.
“A second agreement has been signed for the donation of 10% of Blanket to the Gwanda Community Share Ownership Trust that has been established for the benefit of the local community.
“Pursuant to the terms of the MoU, Blanket will now make a non-refundable donation of $1 million to this trust.”
Caledonia has submitted an agreement regarding the last remaining indigenisation transaction being the sale of a 16% interest to the National Indigenisation and Economic Empowerment Fund.
The Toronto-listed entity will facilitate the vendor funding of all the sale transactions, which will be repaid by way of future dividends from Blanket.
Outstanding balances on these facilitation loans will attract interest at a rate of 10% over a 12-month period.
It said completion of the agreements of sale was subject to approvals from the Reserve Bank of Zimbabwe and Caledonia receiving confirmation from the government of Zimbabwe that full implementation of the terms of the MoU constitutes compliance by Blanket and Caledonia with the requirements of the Indigenisation Act.