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Lerala mine failing to find buyer

Publishing Date : 10 December, 2018


On Thursday three bidders who participated in the recent public auction of the defunct Lerala mine showed keen interest, but failed to part with P2 million required as deposit for the auction.

This is after the mine had gone for an online auction May this year and a highest bidder pledged P80 million but failed to raise the money. The mine had to go back to traditional auctioning and last week the liquidator Kopanang Thekiso advertised the auction on newspapers. Buyers showed interest but could not pay the P2 million deposit. “It is true sir the mine is failing to find a buyer. It is also true that people who came forth this week have not paid the USD 200 000 (P2 million) deposit for the auction,” confirmed Thekiso in an interview.

Those who stand to lose big in this botched sale of the mine remain the twenty creditors who are owed  P359 million and148 former employees awaiting payments amounting to close to P9 million by Lerala Diamond mine.  Information received by this publication is that some buyers went even down to trying to buy the mine for P2 million while other wanted to pay P5 million. Everyone wanted to buy the mine cheaper and the liquidator admitted to this publication that the mine is going to be sold for a song. But the creditors will be given whatever the market offers, said the liquidator.

Also, the value of the mine is not known. Thekiso said they could not afford the money for valuation and they are just letting buyers to compete for the mine. Lerala mine auction included mining and water rights, five Kimberlite pipes ranging from 0.16 hectares to 2.35 hectares in area, a 200 metric tonnes per hour processing plant and a 4.2-megawatt diesel generator, among other assets.

The new buyer will get transfer of the mining license and rights; a complete processing plant, which includes a 200 t/h conventional fines plant and a course dense medium separation plant; final integrated X-ray recovery house; primary jaw crusher; secondary cone crusher; high-pressure roll crusher; scrubbers; material reticulation of conveyors; screens; bins; thickener plant and tailing dams; diesel generator plant; electrical reticulation; workshops; offices; and a mining camp.

Before the recent public auction Lerala used the online auctioneer GoIndustry DoveBid to sell the mine, but the efforts hit a snag after the attempted buyers failed to pay the money they promised. The Lerala Mine was opened in 2008 and had to be shut twice due to weak sales, until it finally was placed under judicial management in May last year, leaving 130 people out of work and millions in unpaid bills.



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