Pan African Resources plc (LON:PAF) shares retreated on Thursday morning as the firm revealed that PAR Gold Propriety Limited has disposed of 130mln of its shares, representing 5.8% of the miner's issued share capital.
The AIM-listed company said the disposal was at a price of R1.15 (around 6.9p) per share, representing a 5% discount to the company’s last closing price of R1.21 (7.3p) on 29 May. In early morning trading, Pan African shares were trading at 7.15p, down 3%.
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Following the disposal, PAR Gold continues to hold 306.36mln Pan African shares, representing 13.7% of the issued share capital of the company.
Pan African Resources is an indirect 49.9% shareholder in PAR Gold and will receive the majority of the proceeds from the disposal.
The company said the proceeds of approximately R126mln (around £75.9mln) will be used for general corporate and liquidity purposes and to fund the expansion of the Elikhulu project’s throughput to 1.2mln tonnes per month.
Pan African said: “Following receipt of the proceeds from the Disposal, the Company has, in conjunction with its existing debt facilities, the necessary resources to meet its operational and immediate growth objectives and fund its ongoing capital requirements.”