10 Oct Empowerment firm buys into Mpumalanga coal-mines
A Pretoria-based black economic empowerment company has clinched a deal which will see it acquire a controlling share– holding in one
opencast and two underground coal-mines in Mpulamanga for R130-million.
The transaction will give Luvhomba Mining, headed by lawyer-turned-businessperson Matthews Mulaudzi, a 51% equity stake in the Mooiplaats and Holfontein underground mines and in the Zaid opencast mine, which are currently owned separately by three companies.
While not much mining is taking place at the col-lieries, their com- bined reserves are said to be so sub- stantial that, at the envisaged min- ing rates, each is expected to be in operation for about 50 years.
Luvhomba Mining’s intention is to produce 100 000 t/m at Holfontein, 45 000 t/m at Mooiplaats and 16 000 t/m at Zaid for the domestic and export markets.
“We are of the opinion that it will not take us long before we achieve these pro- duction volumes,” says Mulaudzi, adding that the current staff and management will be retained.The Mpumalanga collieries deal will be financed through structured debt.
Established last year, Luvhomba Mining is a subsidiary of the three-year-old Luvhomba group, which has interests in a range of sectors.
Mulaudzi is the main shareholder and MD, and his fellow executive directors are Wonderful Mothiba and Mabontsi Makhubedu, both of
whom are black women. Serving on the group’s board as nonexecutive directors are Patrick Makhubedu and George
Although Luvhomba Mining is a relative newcomer on the South African minerals scene, it has wasted no time in pursuing what could turn out to be lucrative ventures.
In addition to the Mpumalanga col-lieries deal, it has signed an agreement for the acquisition of a controlling stake in Pegmin mine – which owns the Union industrial-minerals mine near Phalaborwa – for R43,2-million, and plans to look for mining opportunities in Zambia and the rest of sub-Saharan Africa in partnership with the Micronised group. This will see the company expand its industrial-minerals-mining activities.
This deal will see Luvhomba Mining starting a feldspar-bene-ficiating venture in Phalaborwa, with the raw material being sourced from a section of the Union mine.
“The beneficiation will be carried out on site, and the Luvhomba staff will be sourced from either Phalaborwa or Hoedspruit. The advantage of the project is that it will create viable jobs at an average capital and training cost of less than R15 000 per new employee,” says Mulaudzi. It is expected that the project will create 40 permanent jobs.
To hone his skills as a mining executive, Mulaudzi, who holds a master’s degree in law from the University of Pretoria, is currently attending the six-month executive development and preparatory programme being run by the Department of Minerals and Energy in association with Wits Technikon and the Mining Qualifications Authority.
“My fellow directors and I have brought different types of expertise to Luvhomba; Mothiba, for instance, is an expert in human resources, while Sebulela is an expert in finance, sales and marketing and the Makhubedus have had experience in project management and business strategy respectively,” says Mulaudzi.