Coal of Africa Share Discussion Threads

[2bozmo] 02/12/2015 14:16

Are we not a sitting duck for someone just to come in and take us out? Almost everything's in place, the rand is dirt cheap. If someone can buy 34% of Makhado for $114m, why not just take out the company itself?

[casual47] 02/12/2015 13:14

I think we can summarise this as:

*Huge potential but share price likely to remain depressed while more pieces of the puzzle are put in place and until the overall picture becomes clearer.*

Today's share price movements following yesterday's MOU news certainly seem to confirm this.

[bobsa] 02/12/2015 12:48

Not my work, off poster Jonathan111 on an Australian Forum.

Makhado currently 100% interest by CZA (Boab)

Proposed Interest
Hengshun 34%
BEE 26%
CZA 40%

Capital Cost approx. $600m AUD
Hengshun 34%
BEE 26%
CZA 40% $240m

$155m AUD to be raised hopefully from sale of 34% to Hengshun
$90m AUD remaining needs to be raised for CZA's share of captial exp costs.

Target ROM 12.6mtpa for 16 years
5.5mpta yield
Hard Coke 42% 2.3mpta
Thermal 58% 3.2mtpa


Thermal coal price for break even - ?
Coking coal price for break even - ?

Yearly CZA Admin Cash Burn - ?

UNV profit per year attributable to CZA -
(NCC and Kanagla)

[bobsa] 02/12/2015 12:26

new CoAL share, means one Coal of Africa Limited ie CZA share. They are new because they get added on top of the existing CZA shares on issue.

So to answer your question you will get 1 for 1, well technically, you get to keep the ones you already have.

Existing CZA shares = 1.927B

There are about half a billion shares in UNV, but about 80% of shareholders are taking up the convertible loan notes, so about 100M, give or take, new CZA shares, will be issued. Our cash will also go down by c. $20M too.

Agree with the comments; $400M seems massive, however with cash flow coming in from UNV mine it's not completely illogical to do it with cash flow. They made $15M profit last year, so not massive, however this should hopefully move toward $25/30M, especially if we can get how new Baobab major shareholder potentially willing to lend a big chunk, hopefully 80-90%.

It will be tight, however the company will hopefully be spewing money once Makhado is in production. They is ofcourse Vele...cash from Mooriplats, and the UNV mines moving into production.

Don't have alot of faith in CZA managers, however the UNV guys coming on board know what they are doing and how to get a mine in production on budget and profitable.

[casual47] 01/12/2015 20:34

The question is.....how many New Coal shares will we get for each CZA share?

[casual47] 01/12/2015 20:31

Also, if the Reverse Takeover of Universal goes ahead, then:

1. Universal shareholders get 1 New Coal share for every existing 1 Universal share (slightly more than half a billion shares in total)

2. The deal values each New Coal share at 0.05 AUD or 2.43 pence

[casual47] 01/12/2015 18:34

Will depend on how they can finance the going into production...Until clarity on that re. Makhado is provided for the $400m it will hang over CZA as a liability.

My average is 6p....hopefully the pattern of the last year or so will remain and I may yet have opportunity to average down later this year when (hopefully) funds become available

[2bozmo] 01/12/2015 18:30

Casual, then what value do you put on Vale, Mooiplaats and Greater Soutpansberg Project? These GSP assets potentially as valuable as Makhado....

[casual47] 01/12/2015 15:51

Makhado Project value of at least US$335 million ==> 0.209375 USD per share ==> 0.138963 GBP per share

However this also implies CZA will need to find $400 million USD to finance the construction so the above is assuming there won't be any dilution.

[casual47] 01/12/2015 15:44

Edit -- just seen RNS...doh!

[2bozmo] 01/12/2015 15:29

Values Makhado at least $335m = 11.6p

[casual47] 01/12/2015 14:43

Looking at PDF again they are talking about 34% stake in Baobab Mining & Exploration (Pty) Ltd, the subsidiary that owns the Makhado Project.

So the question is.....how many pence in the share does Baobab Mining & Exploration (Pty) Ltd represent within the CZA share price?

[boodgewoodge] 01/12/2015 14:33

2bzomo , once again right on the money ..... the sellers have thinned out remarkably over the last 30 min on the jse

[casual47] 01/12/2015 14:33

Boodgewoodge -- yes, the article states that but it also states that the deal is worth over 100 million USD.....so I think the jury is out on that one until we have an RNS...in English

[2bozmo] 01/12/2015 14:31

5.9p for stake in Makhado under my calc

[boodgewoodge] 01/12/2015 14:30

the article clearly states its a buy of a 34 % stake in a coal MINE , not a coal COMPANY

[casual47] 01/12/2015 14:23

I edited my earlier comment. The amount that is in the PDF is 139 hundred million.

I think this may be CNY currency rather than USD, which would make sense:

139,000,000.00 CNY = 21,731,131.29 USD

If the 34% stake is of the whole CZA then this corresponds to valueing the company to 2.64 pence per share.....

So perhaps not such a great deal.

[boodgewoodge] 01/12/2015 14:18

well i hope the SENS/RNS will be in ENGLISH !!!

[boodgewoodge] 01/12/2015 14:15

in the same vein , the Universal project was one that was well negotiated and must have been well researched , and that came to the market from out of the blue .... or did i miss the build up

[casual47] 01/12/2015 14:15

I stand corrected.

There is truth to it.

See:




It's in chinese but if you google translate you can get the gist.

[casual47] 01/12/2015 14:06

Yes, something like this will have been negotiated for a very long time under strict confidence and then announced by RNS.

The numbers don't add up either.

[boodgewoodge] 01/12/2015 14:04

just checked , the chineses company exists as detailed , the reporter exists , but seems too big not to be a RNS/SENS first

[casual47] 01/12/2015 13:47

That link about Chinese company buying stake looks like mis-translation / bogus to me.

1. For sure CZA would have been forced to RNS this.

2. It says "deal worth 114 million U.S. dollars" (for 34% stake) yet the market cap value of CZA as a whole is only around 75 million USD

[ianio5691] 01/12/2015 13:44

Never understood the quoted spread here. You can always trade at vastly different prices to those quoted.
It is quite illiquid though, so any concerted buying will have an impact...
GLA