Harare - Shareholders in Zimbabwe-focused gold producer, New Dawn Mining Corporation, have agreed to make several changes in respect of the firm’s share trading.
The Toronto Exchange-listed company recently held a shareholders meeting in which they approved to reduce the stated capital of the common shares of the company, increase the maximum number of shares issuable pursuant to the Company’s Stock Option Plan, as well as amend the Articles of the Company to create an unlimited number of a new class of special shares which are issuable in series.
The development comes at a time when the company is gearing up to compliance with Zimbabwe’s Indigenisation and Empowerment Act.
In August 2011, New Dawn signed a confidential Memorandum of Understanding with the Ministry of Youth Development, Indigenisation and Empowerment, which established a broad-based framework for the company’s compliance.
Following the signing of the MoU, a valuation firm was chosen by the National Indigenisation and Economic Empowerment Board and the resultant valuation report was completed and submitted in early November.
On the basis of the valuation report, New Dawn made revisions to its plan and met with Empowerment Ministry officials at the beginning of this year.
New Dawn says it is still waiting for official communication from the relevant authorities on the way forward.
New Dawn earlier indicated that its indigenisation compliance plans may include employee and community share-ownership schemes, disposal of equity to identified indigenous Zimbabweans as well as listing on the Zimbabwe Stock Exchange.
The company has also hinted that it will use its indigenisation compliance plan to raise funds to implement its current business plans, indicating a significant bias towards equity disposal.
In terms of the indigenisation regulations, the value of the shares to be transferred to the buyer will be calculated on the basis of a valuation agreed by the Empowerment Ministry and the firm.
“Subject to successful acceptance by the government of Zimbabwe and implementation of New Dawn’s Plan (as may be modified by mutual agreement), the company believes it would then have the additional working capital resources necessary to support its efforts to increase gold production to 100 000 ounces of gold on an annualised basis by the end of 2014,” said the company in an earlier trading update.
The company, whose mines are exclusively based in Zimbabwe , is targeting to ramp up production to between 50 000 and 60 000oz of gold this year from 40 000oz in 2011, and further targets 100 000oz by the end of 2014.
New Dawn owns in whole the Turk/Angelus Mine Complex, Old Nic Mine and the Camperdown Project.
The company also has an approximately 85 percent equity interest in the Dalny, Golden Quarry and Venice Mines, and a large portfolio of prospective exploration acreage in the country.
Four mines are presently operational, and the company is in the process of expanding production at these sites.