BARBERTON: The first tranche of payments to creditors will commence immediately and be completed by March 8.
The business rescue practitioners (BRPs) of emerging gold producer Vantage Goldfields, in a February 15 amendment to the adopted business rescue plan, stated that they have received an offer from Vantage to provide the capital required to self-fund the process of reopening the Lily and Barbrook mines, in Mpumalanga.
The commencement of the amended plan, which came into effect on February 15, makes reference to the proposed reopening of the Lily mine by July 2.
Vantage CEO Mike McChesney says that because these plans have already been adopted by creditors, the process is quick and there is no need to present and consider new plans.
For the necessary funding to be made available to the company, the BRPs − Rob Devereux and Daniel Terblanche – state that Vantage requires the adopted business rescue plan to be amended to reflect that all approved secured claims, approved post amendment funding claims and approved preferent claims will be discharged by means of payment to such creditors of an amount equal to 100% of their approved claims.
As such, all creditors will be paid R1 a share (expect for Vantage subsidiary, Makonjwana Imperial Mining Company [Mimco] concurrent creditors who will receive 30c apiece as per the approved plan) with 65% of all the approved claims to be paid to the relevant creditors within 15 business days of the effective date of the amendment to the business rescue plan.
In addition, the balance of 35% will be paid within 60 business days of the effective date of the plan.
All approved concurrent creditor claims will be discharged by means of payment to such creditors of an amount equal to 30% of their approved claims, with 65% of all the approved claims to be paid to the relevant creditors within 15 business days of the effective date of the plan and the balance to be paid within 60 business days of the effective date of the plan.
The first tranche of payments to creditors will commence immediately and be completed by March 8.
McChesney previously said that the Lily and Barbrook mines were not for sale and that the company intended to retain ownership and self-fund the reopening of both mines.
He added that all previous attempts to sell the mine had failed because of nonperformance by potential buyers or “self-serving interference”, including litigation by previous bidders in the business rescue process.
Action SA leader Herman Mashaba has hailed the news of the reopening of the Lily Mines.
He had been vocal in the retrieval of the bodies of Solomon Nyirenda, Pretty Nkambule and Yvonne Mnisi were trapped underground when a shaft they were inside collapsed in 2016.
“Action SA is delighted to announce that the Business Rescue Process (BRP) practitioners have published the amended plan for Lily Mine, awarding the mine to a successful bidder,” reads the statement from Action SA.
Action SA also announced that the payment of all outstanding wages to the former miners will now go ahead.
“Our legal team has also successfully engaged the NPA [National Prosecutions Authority] who have confirmed that a process has been initiated that would lead to a possible prosecution of mine management for the findings that the collapse was a result of criminal negligence.”
The BRPs stated that, by amending the adopted business rescue plan, they would be acting reasonably in so far as the amendment will result in the necessary funding being made available to Vantage to enable it to pay the approved creditors the amounts stated in the adopted plan.
They also note that the amendment is beneficial and not prejudicial to affected persons since the amendment will result in the implementation of the adopted business rescue plan.
“Details of the planned production ramp-up will be provided once this process has been fully assessed,” McChesney said.
However, he notes that, after having sat dormant for five years, ground conditions at both mines would have likely deteriorated and it may take some time for re-entry to be carefully planned.
“The re-employment of former employees will commence as soon as possible so that these long-suffering people and their communities can resume normal working lives,” McChesney added.