| Tue 26 Jul 2011, 16:43 | | RDI - Rockwell Diamonds Incorporated - Rockwell Diamonds` sale of unproductive |
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RDI
RDI
RDI - Rockwell Diamonds Incorporated - Rockwell Diamonds` sale of unproductive
assets generates C$6.5 million to be used to fund capital growth projects
ROCKWELL DIAMONDS INCORPORATED
(A company incorporated in accordance with the laws of British Columbia, Canada)
(Incorporation number BCO354545)
(Formerly Rockwell Ventures Inc.)
(South African registration number: 2007/031582/10)
Share code on the JSE Limited: RDI ISIN: CA77434W2022
Share code on the TSX: RDI CUSIP Number: 77434W103
Share code on the OTCBB: RDIAF
ROCKWELL DIAMONDS` SALE OF UNPRODUCTIVE ASSETS GENERATES C$6.5 MILLION TO BE
USED TO FUND CAPITAL GROWTH PROJECTS
July 26, 2011 Vancouver, BC - Rockwell Diamonds Inc. ("Rockwell" or the
"Company") (TSX: RDI; JSE: RDI; OTCBB: RDIAF) is pleased to announce further
progress in its turnaround strategy, with the sale of three non core assets
which generated total proceeds of C$6.5 million.
"The strategic review which was conducted in the first quarter of 2011, included
an investigation of our asset allocation processes to ensure that all equipment
and properties were being fully utilized," explains James Campbell, CEO
Rockwell. "This analysis of the Company`s asset register helped us to identify
three assets that were not generating adequate returns and the decision was
taken to sell these to generate funds for our capital investment programme. We
will continue with this evaluation process to ensure that we optimally use all
the assets on our balance sheet."
The assets which have been disposed of are as follows:
- The sale of Makoenskloof property, located in the Northern Cape, was concluded
in mid July 2011 for C$0.9m, which will be settled by the end of August 2011.
The decision to sell this property was taken after the exploration and
evaluation results showed that it did not fit Rockwell`s investment criteria and
that it might prove attractive to a third party with a different set of skills.
- The PC3000 excavator located at the Wouterspan mine which is on care and
maintenance has been sold. The sale was completed in the third week of July 2011
and the full sale consideration of C$3.0 million has been received.
- A sale agreement for the Holpan DMS plant has been concluded for a total
consideration of C$2.6 million which is payable in two equal tranches. The first
payment of C$1.3 million has been received with the balance payable within 30
days. The mine was put on care and maintenance in May 2011 and is adjacent to
Klipdam, which has a plant with the capacity to process any gravels extracted
from Holpan in the future.
Campbell highlighted this as "a positive move forward for Rockwell and just one
of many proactive steps being taken to ensure that the Company delivers on its
potential. The funds amounting to C$6.5 million will be allocated towards our
new capital project budget. This includes putting in place a new in-field screen
at Saxendrift, and completing the Tirisano construction project. These funds
will supplement our current capital raising activities, reducing the total
quantity of funds which we are targeting as well as dilution to the immediate
benefit of all shareholders."
Campbell explained that the team "was looking at every aspect of the business
with the objective of ensuring that our focus turned to creating value and
sweating the assets" and did not discount further sales as he cleaned up things
across the Company`s operations.
For further information on Rockwell and its operations in South Africa, please
contact
James Campbell
CEO
+27 (0)83 457 3724
Stephanie Leclercq
Investor Relations
+27 (0)83 307 7587
About Rockwell Diamonds:
Rockwell is engaged in the business of operating and developing alluvial diamond
deposits, with a goal to become a mid-tier diamond mining company. The Company
has three existing operations, which it is progressively optimizing, two
development projects and a pipeline of earlier stage properties with future
development potential. Rockwell is also at an advanced stage of completing the
acquisition of the Tirisano property.
Rockwell also evaluates merger and acquisition opportunities which have the
potential to expand its mineral resources and production profile and would
provide accretive value to the Company.
No regulatory authority has approved or disapproved the information contained in
this news release.
Forward Looking Statements
Except for statements of historical fact, this news release contains certain
"forward-looking information" within the meaning of applicable securities law.
Forward-looking information is frequently characterized by words such as "plan",
"expect", "project", "intend", "believe", "anticipate", "estimate" and other
similar words, or statements that certain events or conditions "may" or "will"
occur. Although the Company believes the expectations expressed in such
forward-looking statements are based on reasonable assumptions, such statements
are not guarantees of future performance and actual results or developments may
differ materially from those in the forward-looking statements.
Factors that could cause actual results to differ materially from those in
forward-looking statements include uncertainties and costs related to
exploration and development activities, such as those related to determining
whether mineral resources exist on a property; uncertainties related to
expected production rates, timing of production and cash and total costs of
production; uncertainties related to the ability to obtain necessary licenses,
permits, electricity, surface rights and title for development projects;
operating and technical difficulties in connection with mining development
activities; uncertainties related to the accuracy of our mineral resource
estimates and our estimates of future production and future cash and total
costs of production. In particular there can be no assurance that refinancing
funds will be available to Rockwell on acceptable terms or any terms at all.
For further information on Rockwell, Investors should review Rockwell`s annual
Form 20-F filing with the United States Securities and Exchange Commission
www.sec.com and the Company`s home jurisdiction filings that are available at
www.sedar.com
Johannesburg
26 July 2011
Sponsor
Sasfin Capital (a division of Sasfin Bank Limited)
Date: 26/07/2011 16:43:01 Produced by the JSE SENS Department.
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