RioZim set to fund gold mining project firm

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RIOZIM says it has obtained Exchange control approval from the Reserve Bank for GEM RioZim Investments Limited to underwrite a $10 million capital- raising initiative.

BUSINESS REPORTER

RioZim said in January that it would raise $10 million to fund the reopening of the Cam & Motor gold mining project and retire other obligations.

It said the capital-raising initiative required approval from the central bank and the ministries of Youth Development, Indigenisation and Empowerment and Mines and Mining Development.

“The company has successfully obtained exchange control approval for GEM RioZim Investments Limited to underwrite the rights offer from the Reserve Bank of Zimbabwe,” the resources company said in a notice yesterday.

RioZim said after discussions with the ministries of Youth Development, Indigenisation and Empowerment and Mines and Mining Development, it was ascertained that the rights offer does not require approval from the two ministries.

RioZim will make a renounceable offer of 66 666 667 ordinary shares of a nominal value of $0,01 each in the company’s share capital, at a subscription price of $0,15 each to existing shareholders in the ratio of 124 931 new ordinary share for every 100 ordinary shares already held by shareholders.

The rights offer opens on June 8 and closes on June 26. Shares arising from the rights offer will be listed on the Zimbabwe Stock Exchange on July 6.

Before its closure in 1968, Cam & Motor has historically been the largest gold producer in Zimbabwe having produced 5 291 100 ounces of gold.

RioZim said recent geological and metallurgic tests revealed that with the current technology and at the current grades of ore, Cam & Motor “is capable of producing significant amounts of gold at a competitive cost of production”.

“Geological exploration in the form of evaluation drilling has delineated a gold resource totalling approximately 6 377 300 tonnes of ore at an average grade of 4,8g per tonne, which equates to 893 330 ounces of gold,” it said.

RioZim said it had placed an order for 1 500 tonnes per day plant which at full capacity was expected to produce more than 3 000 ounces of gold per month.

GEM RioZim Investments Limited has 24,97% shareholding in RioZim.

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