Harmony sells Evander gold mine to Pan African Resources for EUR 141.9mn.

By bne IntelliNews June 1, 2012
Harmony Gold Mining, South Africa's third largest gold producer, said it has entered into an agreement with junior miner Pan African Resources for the sale of its wholly owned subsidiary Evander Gold Mines for a cash consideration of ZAR 1.5bn (EUR 141.9mn). Pan African Resources will fund the acquisition through a mixture of debt, equity and cash. The transaction, which is subject to regulatory approvals, is expected to be finalised by the end of October 2012. In January 2012, Harmony said it had signed a sale of shares and claims agreement for Evander with a consortium comprising Pan African Resources and another junior miner, Witwatersrand Consolidated Gold Resources (Wits Gold), for ZAR 1.7bn. This agreement was terminated after the consortium failed to meet certain conditions. "We are pleased that Evander is being sold at a value within our value range. The proceeds will be received within the next six months, provided all the conditions precedent are met, which will further strengthen our cash position to meet our capital demands in support of our growth strategy", Harmony CEO Graham Briggs said in a statement. The sale is in line with Harmonys strategy to diversify its operations, which are located primarily on the Witwatersrand Basin in South Africa, and to focus more on its highly prospective exploration portfolio and open-pit mining operation in Papua New Guinea. Pan African Resources CEO Jan Nelson said that the acquisition of Evander would double the companys annual gold production to approximately 200,000 ounces. Evander total underground resource represents 32.5 million ounces, and ? reserve of 7.6 million ounces.

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