Caledonia to buy Zimbabwe gold project in $53 mln all-share deal

Baker Steel Resources Trust

21/07/2022 12:02

July 21 (Reuters) - Caledonia Mining Corporation  CMCL.K 
 CALq.L  has agreed to buy Zimbabwe's Bilboes Gold Limited in a
$53 million all-share deal that could quadruple Caledonia's
annual production.
    Caledonia currently owns 64% of Zimbabwe's Blanket gold
mine, where output is expected to reach 80,000 ounces this year
thanks to a new shaft.
    The Bilboes project, which Anglo American sold out of in
2003, could add 168,000 ounces of gold to Caledonia's annual
production, CEO Mark Larmonth said, calling this a
"transformational" asset for the miner hoping to become a
multi-asset mid-tier producer.
    The transaction is subject to the current owners of Bilboes
receiving confirmation from Zimbabwean authorities that the mine
will be able to export gold directly and retain the sale
proceeds in U.S. dollars rather than domestic currency.
    Caledonia will also have to arrange electricity supply for
the project. It expects to restart the mine within six months of
deal completion.
    Bilboes Gold Limited is currently owned by Toziyana
Resources Limited with a 50% stake, Baker Steel Resources Trust
Limited  BSRT.L  (24%), and Infinite Treasure Limited (26%). 

 (Reporting by Nelson Banya, Editing by Helen Reid, Kirsten
Donovan)
 ((Nelson.Banya@thomsonreuters.com;))