Trigon agrees to sell Kombat mine to Horizon Corporation

Kombat Mine in Namibia.

Trigon Metals has received an offer from Horizon Corporation Limited for the sale of 100% of its ownership interest in the Kombat Mine.

According to a statement from the company, Trigon had received an indicative term sheet from Horizon with a proposed loan of US$5 million (about N$100 million) to allow for the evaluation and due diligence at the Kombat Mine which only resumed operations in May last year, after a 14-year hiatus.

Also included was an offer ranging between US$30million to US$50 million (N$540 million to N$900 million) in cash, and a limited royalty that would be paid to Trigon from the Kombat Mine’s copper production.

A term sheet is a non-binding agreement that spells out the basic terms and conditions of an intended investment agreement. It is a template and basis for more detailed, legally binding documents.

Once the parties involved reach an agreement on the details laid out in the term sheet, a contract that conforms to the term sheet details is drawn up.

The proposed transaction remains subject to certain conditions, including completion of satisfactory due diligence, the negotiation and execution of a definitive agreement between Trigon and Horizon, third party approvals, shareholder approval and regulatory approval by the Namibian Competition Commission.

Confirming the development, Trigon Metals chief executive and chairperson Jed Richardson, whose Namibian partner is renowned deal ‘fixer’ Knowledge Katti, said in the statement: “Agreeing to a sale of the Kombat Mine is a very difficult decision. We are pleased that Horizon has come forward with a competitive offer for the Kombat Project.”

He said the proposed transaction would cap dilution and offers shareholders risk-free benefit from the future success of the asset.

“We look forward to working closely with Horizon to settle final terms, reach definitive agreements and complete the proposed transaction,” he said.

Bradley Rawson, the executive chairperson of London-based Horizon Corporation, says: “We are currently active in both sub-Saharan Africa as a mining region and copper production as a business, so we view this transaction as a good opportunity to add to our portfolio of assets and to extend our working history in Namibia.

“Our group is looking forward to growing the Kombat Mine by working with the local team and the Namibian authorities to ensure a positive outlook for our stakeholders, Trigon shareholders and the local community,” he said.

Mine Workers Union of Namibia northern regional organiser Reginald Kock expresses concern over the workers’ future.

The mine, situated near Otavi in the Otjozondjupa region, employs about 200 workers, some on contract basis.

He wrote to Trigon vice president for operations Fanie Muller on 5 December, seeking clarification on the potential impact of this transaction on current employment contracts.

“The union seeks assurances that existing employment agreements and conditions will remain in force under any new ownership arrangement,” Kock wrote, adding that the union’s priority is to safeguard the rights, welfare, and interests of workers.

Katti could not be reached for comment.
– email: matthew@namibian.com.na

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