Through the acquisition, Forbes will acquire two South African coal mines, the Zululand Anthracite Colliery (ZAC) and the Riversdale Anthracite Colliery (RAC).
ZAC, of which Forbes will own 74% stake, is a producing anthracite mine, whereas RAC is an undeveloped anthracite resource located in the Kwa-Zulu Natal province of South Africa.
Under the terms of the transaction, Forbes will also pay an annual revenue share of 10% on incremental revenues of over and above ZAR850m until 2025.
Forbes Coal president and CEO Stephan Theron said that the acquisition is strategic with the company’s plans to become a 3-4 million tonne producer.
"Our original timeframe was to complete this within the next 18 months and with the acquisition we expect to be producing almost 2.5 million tonnes in less than a year’s time," he added.
"ZAC is known as a premium high quality anthracite producer and increases Forbes Coal’s exposure to the high margin metallurgical coal market."
