Rockwell considers selling assets that don’t fit business model

Rockwell Diamonds Inc. is undertaking a turnaround plan pursuant to the Management Discussion and Analysis issued in mid-October that the company was undertaking a strategic review of its assets and business options. The company noted that the turnaround plan was unanimously approved during a special Board meeting this month.

In this vein the company has decided to reduce overall operations footprint by disposing of any assets that do not fit the business model. A sale process in respect of Remhoogte/Holsloot and Saxendrift mines is now underway. Apart from this, the company is also planning a ramp up of Wouterspan to its full production volume of 200,000m3 a month to be accelerated, a material reduction in cash operating and off mine costs to be realized.

The company also intends to increase production volumes in Q1 of FY2018 with a further 60,000m3 a month by relocating the Holsloot plant to Wouterspan North, where additional Rooikoppie gravels have been delineated, securing adequate and timeous cash investment to facilitate the procurement of capital items and supplement cash flow for the first five months.

The company also received additional funding worth US$8M on similar terms to the current loans, to enable the necessary upgrades to equipment and infrastructure to implement its turnaround plan.