Lewcor buys Elizabeth Bay Mine
12 September 2019 | Business
Namdeb has explored a variety of options to extend the life of its Elizabeth Bay Mine beyond 2019, but ceased operations in September last year, as the company could no longer economically run the operation.
Following the review, Namdeb concluded that the best way to secure a future for the mine was to find an operator suited to operate the mine in a sustainable way, ensuring continuation of employment and economic activities in Namibia.
Choosing the right operator has always been an essential part of the decision, and Namdeb believes that the sale of Elizabeth Bay Mine to Lewcor will aid the transformation of the mining industry. The Lewcor Group is an experienced and well-regarded company in the Namibian mining and civil contracting industry, with more than 20 years of experience.
The sale followed a competitive process that attracted significant expressions of interest. The decision to sell to Lewcor was founded on the basis that it has sound technical and financial capability as well as strong corporate social responsibility credentials, including a demonstrated commitment to Namibia.
The transaction has a value of N$120 Million to Namdeb, with potential upside to N$180 Million, depending on a number of factors. In the longer term, this value could increase significantly, as Namdeb will share in the revenue earned in the sale of diamonds recovered from certain marine mining areas associated with the Elizabeth Bay Mine, and which Lewcor has indicated it will bring into production in the near term. In addition the transaction creates employment opportunities for those affected by the closure of the Elizabeth Bay Mine, and for the larger community and economy of Lüderitz and Namibia.
Namdeb chairman Chris Nghaamwa said that throughout the process, their objective has been to create the best possible circumstances for re-opening the operations, re-creating jobs and growing empowered participation in Namibia’s diamond industry. “A rigorous, independently-advised process enabled Namdeb to select a company with not only the right mining and financial credentials, but also a commitment to meet future social and environmental obligations. We are delighted that the new owner is broad-based, and is fully owned by Namibian citizens.”
Riaan Burger, CEO of Namdeb, said: “I am hugely appreciative and grateful for the commitment of our employees over many years and wish to thank them for their dedication. Although the decision to sell the mine has not been easy, it was the right thing to do for its future, its employees and the Lüderitz community at large.”
The transaction with Lewcor is subject to customary suspensive conditions, which all parties hope to conclude without delay.