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Metallon sells gold assets to Tagwirei’s Landela

Mzi Khumalo’s Metallon has completed the sale of Shamva Mine to Kuda Tagwirei’s Landela Mining Ventures, while the sale of Mazowe Mine is expected shortly. The transaction represents a change of guard in the industry. Metallon was once the country’s largest gold producer. It is now down to just a single working operation, How Mine in Bulawayo. Its other remaining mine, Redwing near Penhalonga, has been idled for over a year and is also up for sale. As the sun sets on Khumalo’s gold empire, it is rising on well-connected Landela, which has used its influence to take over key mining operations over the past year. Production at Shamva, which has stalled since last year, has now resumed after the change of ownership, Landela CEO David Brown said. “We are now focusing on growing production,” Brown said. The purchase price has not been disclosed. For 2017, the last publicly available production results, Shamva produced 20 359 ounces of gold, while Mazowe’s output was 8 888. Shamva has an estimated resource of 2,5 million ounces of gold as of 2018, while Mazowe’s estimate is at 1,8 million ounces. A 2016 estimate showed the Metallon group had a significant mineral resource of 8,3 million ounces of gold. This resource drew the interest of some potential buyers, including Canada’s B2Gold Corp. The company’s interest cooled after government officials rejected its demands to be exempted from selling gold to central bank. South Africa’s Randgold also made enquiries in 2018, but did not pursue its interest further. Prior to suspending operations, Mazowe employed over 600 employees, while Shamva had 800 workers. In total, Metallon last year owed over $40 million in salaries, benefits and other related debts such as unremitted pensions, including over $1 million owed to the National Social Security Authority. Shopping spree This latest acquisition adds to a string of mining assets taken over by Landela over the past year. In October last year, Landela became a 50% partner in the Darwendale platinum project. That same month, Landela bought Asa Holdings’ 74,13% stake in Bindura Nickel and took over Freda Rebecca gold mine. More recently, Landela has taken control of some of the gold assets of the Zimbabwe Mining Development Corporation (ZMDC), including Sabi gold in the Midlands. In 2018, government put six ZMDC mines on sale, as part of a broader privatisation drive. Despite receiving 151 offers, the sale was cancelled in 2019, paving the way for Landela to run the mines. Tagwirei is already a shareholder in African Chrome Fields and has been linked with bids for ferrochrome producer Zimbabwe Alloys. Now in control of Freda Rebecca, ZMDC mines and the two Metallon operations, Landela will become a major gold player. Freda was recently licensed to buy gold, and targets 500kg of gold per month from tribute agreements with small miners working on its 60 000ha claims. Metallon’s decline While Landela rises due to its reported connections and deep pockets, Metallon’s fortunes have waned. This has been down to poor government relations, f

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