Mvelaphanda Resources on Thursday announced plans that would see the company restructured with a view to delisting.
Within the next two years the company plans to sell its 7,1% stake in Gold Fields and unbundle its 63% holding in Northam Platinum in an attempt to unlock value for its shareholders.
Mvela Resources will also look at selling its stake in diamond producer Trans Hex.
At the end of the day, Mvela Resources will cease to exist, the company confirmed.
According to Mvela Resources head of investor relations James Wellsted, the group essentially intend to sell its Gold Fields shares and settle the group’s R4,3-billion debt before recapitalising Northam through a rights offer and later unbundling its Northam holding to shareholders before delisting.
The group, announcing its interim results, said it has refinanced R2,1-billion of mezzanine debt related to its acquisition of its stake in Gold Fields shares.
This extended the repayment of the loan by a year and buys Mvela Resources more time to sell its Gold Fields stake in an orderly fashion.
Mvela Resources, which has been invested in Gold Fields for five years, takes ownership of the 50 million shares in March this year.
Proceeds from the sale of the shares, which are currently worth R5,9-billion, will be used to settle the company’s debt. — I-Net Bridge