Fin24

Keaton finalises LME deal

2012-01-06 13:47

Johannesburg - South African coal exploration and development company Keaton Energy Holdings [JSE:KEH] on Friday said it had implemented its R140m acquisition of a 74% stake in in Leeuw Mining and Exploration (LME).

The acquisition gives Keaton a foothold in the coal exports market.

Conclusion of the acquisition hinged mainly on the department of mineral resources' consent for change of control of LME. This was granted last month.

The acquisition, which was announced in February last year, was settled through the issue of new Keaton shares and R10m in cash to settle an existing loan to LME.

The deal gives Keaton a controlling interest in an existing operating anthracite colliery, significantly increases its portfolio of advanced development projects, and provides vital access to export markets and a wider customer base.

"LME has a renewed 200 000 tonnes per annum participation in Richards Bay Coal Terminal's Quattro export programme and a dedicated railway siding facility near Vaalkrantz," said Keaton in a statement.

It would also mark a major step towards Keaton Energy's objective of becoming a mid-tier coal producer with a diverse range of projects to complement its major Vanggatfontein and Sterkfontein projects in Mpumalanga.

LME's founding shareholder JPI Leeuw and Associates will remain a 26% shareholder in LME.