- West Wits Mining (WWI) acquires its BEE partner Lilitha Resources’ interest in its subsidiary West Wits Mining SA
- The acquisition increases West Wits’ direct ownership interest of the Witwatersrand Basin Project (WBP) in South Africa to 74 per cent and simplifies its corporate structure
- The company will pay Lilitha Resources $50,000 in cash and 96 million shares
- West Wits MD Jac van Heerden says the purchase will increase the company’s share in the South African project at a “substantial national discount”
- WWI shares are trading 3.57 per cent lower at 2.7 cents as of 12:57 pm AEST
West Wits Mining (WWI) will acquire its BEE partner Lilitha Resources’ interest in its subsidiary West Wits Mining SA (WWM SA).
The acquisition would effectively increase its direct ownership interest of the Witwatersrand Basin Project (WBP) to 74 per cent and simplifying its corporate structure.
The WBP in South Africa is said to transform West Wits Mining into a long-term gold producer, with an average steady annual run-of-mine production of 65,000 ounces for 25 years.
West Wits will pay $50,000 in cash and 96 million in shares for the acquisition, with 75 per cent of shares to be held in escrow.
Managing Director of West Wits Jac van Heerden said the acquisition will increase the company’s share of the project at a substantial national discount.
The value is implied by the US$227 million (A$316 million) net present value of the WBP Scoping Study released in March.
“The transaction also substantially simplifies [our] corporate structure, making WWM SA 100 per cent-owned by WWI, and further aligns our BEE partner’s interest to the company by becoming a WWI shareholder, extending our long-term and valued relationship.”
The company also stated that the acquisition is mutually beneficial for both West Wits and Lilitha as it extends their long-term relationship.
The substantial non-cash component of the consideration will enable West Wits to preserve cash for the development of the project, while Lilitha obtaining promising exposure as a shareholder at the West Wits group level.
Shares in West Wits Mining were trading 3.57 per cent lower at 2.7 cents as of 12:57 pm AEST.