MC Mining’s shares fall after acting CEO quits
By Dineo Faku
JOHANNESBURG - JUNIOR coal producer MC Mining weakened 5.56 percent to R1.87 a share on the JSE yesterday as the market digested the news of acting chief executive Brenda Berlin’s surprise resignation.
The share closed 7.07 percent lower at R1.84 yesterday.
MC Mining, formerly known as CoAL, said late on Monday that it was searching for a new chief executive as Berlin prepared to step down eight months after being appointed. MC Mining said Berlin would step down next February.
“The company expects to appoint a permanent chief executive within sufficient time to allow for an orderly handover,” MC Mining said.
Berlin, who was previously chief financial officer (CFO) at Impala Platinum, joined MC Mining in April 2018 as executive director and CFO and was appointed as acting chief executive in February this year.
Chairperson Bernard Pryor commended Berlin for successfully steering the group through the turbulent period following the spread of the Covid-19 virus and subsequent lockdown.
Pryor said that Berlin had played a leading role in securing the majority of the funds required to develop the Makhado hard coking coal project.
“The Covid-19 pandemic has made the past year incredibly challenging, and Berlin has been instrumental in navigating the company through these turbulent times and in securing the majority of the funds required for Phase 1 of the Makhado Project. I wish her well in her future endeavours,” Pryor said.
The group said Berlin’s departure in February was not expected to impact on finalising the Phase 1 funding package. The Limpopo-based Makhado project has an expected life-span of more than 46 years, with the group expecting its phased development to position it as South Africa’s pre-eminent hard coking coal producer.
The company said it had made significant progress in securing the funds required to construct Phase 1, which would create more than 650 direct, permanent job opportunities and reduce the volumes of hard coking coal imported into South Africa.
Phase 1 comprises the construction of the Makhado west pit and modifications to the existing Vele Colliery processing plant to process the screened and scalped Makhado run-of-mine coal. The total funding required for the development was about R575 million.
MC Mining said last week it had submitted a formal application to extend the repayment period of its loan facilities with the Industrial Development Corporation (IDC), and the IDC had acknowledged this application.
In March 2017, MC Mining secured a R240m facility from the IDC.
The company utilised R120m of this facility to develop Makhado, including progressing the project to fully permitted status and completing the acquisition of the surface rights required for the mining area.
In August 2020, the company and the IDC agreed to restructure the balance of the initial IDC facility, and MC Mining drew down R40m and agreed to cancel the balance of the initial IDC facility. The first and second drawdowns resulted in the IDC becoming a 6.7 percent shareholder in the Makhado Project.