We know that the China Development Bank is involved with VZ and the mining of gold has been mentioned with them a lot recently. They have also been doing deals all over the world especially recently in Zimbabwe and Africa. This was in the news today and you have to wonder if they may be crafting something similar with KRY?

Wesizwe finds strategic partners for core project
May 24, 2010

Platinum exploration and development company Wesizwe Platinum on Monday announced that the Jinchuan Group and China-Africa Development Fund (CADFund) would become strategic partners in the company's core Frischgewaagd-Ledig Project.

Wesizwe said the Jinchuan Group and the CADFund have agreed to provide "a total financing solution" for the development of the project.

The Jinchuan Group is a Chinese state owned company under the jurisdiction of the Peoples Government of the Gansu Province while the CADFund, which was established in 2007, is the first investment fund in China focusing on investments in Africa.

The proposed transaction will, if successfully concluded, comprise of an equity component of $227 million whereby JNMC and CADFund (or a new entity to be jointly owned by the Jinchuan Group and the CADFund will subscribe for close to 829.9 million new ordinary Wesizwe shares.

These shares will constitute 51 percent of the fully diluted issued share capital of Wesizwe upon closing of the proposed transaction and will carry an aggregate subscription price of $227.53 million.

This will equate to a subscription price of R2.07 per Wesizwe share at an exchange rate of $/R7.55.

The transaction also carries a debt component where the Jinchuan Group and CADFund have secured a Letter of Commitment from the China Development Bank for the provision of a $650 million project finance facility.

A third component involves a financial guarantee/shareholder loan commitment that will see the Jinchuan Group provide any funding shortfall needed for the project to reach full production via a shareholders loan to Wesizwe on the same commercial terms as the debt component.

The Jinchuan Group and Wesizwe have also agreed that the Jinchuan Group will purchase all of the platinum group metals (PGM) concentrate from the project through a long term off-take agreement.

"Wesizwe believes that the proposed transaction represents both a compelling value and strategic proposition for shareholders," the company said in a statement to the JSE.

After a challenging 2009, Wesizwe put significant activities for the development of the Frischgewaagd-Ledig Complex were on hold.

The platinum exploration and development company said in March it was considering bringing in a strategic local or foreign partner for the development of its the complex.

The company said a Bankable Feasibility Study (BFS) completed in 2008, based on a high-grade ore body with an estimated 35-year life of mine, indicated that the project is robust.

Now the proposed transaction with the Jinchuan Group and the CADFund would provide shareholders with a total financing solution of $877 million (R6.6 billion) for the development of the project.

Consisting of a combination of debt and equity, the proposed transaction "will ensure that that there will be no further equity dilution through the project's construction phase," Wesizwe said.

At 10.28am shares in Wesizwe were up 12 percent or 24 cents at R2.24 on the JSE. - I-Net Bridge