| Tue 14 Jun 2005, 10:59 | | Motjoli steps in to rescue Yomhlaba |
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YOMHLABA, the first resources company to list on the JSE Securities Exchange SAÆs AltX board, is to be rescued through a merger with empowerment company Motjoli Resources, says the new ventureÆs CE, Nonkqubela Mazwai.
The move will allow a resumption of trade in Yomhlaba, which is to be renamed Motjoli.
Yomhlaba was suspended from trading in March after it lost its contract with its sole customer, Ingwe Coal, a wholly owned subsidiary of BHP-Billiton.
Ingwe alleged there had been fraud by Yomhlaba, which had contracts to process coal dumps using a sorting process known as jigging.
Yomhlaba, which is 50% owned by the New Africa Mining Fund, has denied the allegations and has promised an independent inquiry.
Mazwai said yesterday that Motjoli was a 30% stakeholder in Yomhlaba, through preference shares, and had an interest in finding a solution to the problem.
She said the section of Yomhlaba involved in the dispute with Ingwe was being ôspun off to carry on the investigationö.
Meanwhile, a new company was being formed with the residual Yomhlaba business, which will be run by Motjoli.
She will be the first black female CE of a listed mining company.
ôIÆll bring over our management team, the company will be renamed Motjoli, and the aim is to get the suspension lifted,ö Mazwai said.
ôThis will be our coal vehicle, and we will run it full time.
ôWe are rolling our other coal assets into this.ö
The current Motjoli will hold 30% of the restructured company, and the fund will hold more than 40%, a stake expected to be sold to Mazwai over the next five years.
She said she had a pre-emptive right to acquire it.
Meanwhile, a coal-producing mine will also be included by the fund in the restructured AltX company.
ôWe are very excited by this deal,ö said Mazwai.
She said the company would meet the empowerment criteria of the mining charter, and would hope to grow further through new deals.
The new company will resume the work that Yomhlaba had carried out for Ingwe, and is also hoping to acquire further contracts for reprocessing coal dumps.
Former minerals and energy department director-general Nchaka Moloi is chairman of Motjoli, and will chair the restructured company.
Moloi said that the business would be cash-generating and would act as a coal miner in exploration and in recovering coal from mine dumps.
He said he and Mazwai had worked for government and were experienced in issues such as the conversion of mining rights under the mining charter, which was launched in May last year.
Said Mazwai: ôA lot of other empowerment groups want to partner with us, but we need to choose carefully.ö
