Harmony Gold announced that it has sold a 60 per cent stake of a new company it formed to house uranium assets for $US252 million to Africa's biggest private equity fund, Pamodzi Resources Fund.
Harmony said it had launched the venture to take advantage of buoyant uranium prices and would retain a 40 per cent stake in the new company, which it said may be listed in the future.
The world's fifth biggest gold producer said cash from the sale would be used for capital expenditure and to pay off debt.
South Africa's Harmony wants to revive production of uranium -- which is used to fuel nuclear reactors -- as a by-product of gold mining and valued the new, unnamed firm at $US420 million.
Graham Briggs, Harmony's acting chief executive, said the new company would seek funds to build a uranium plant with an output of 500,000 tonnes of ore a month and a new gold waste site at a cost of about 1.7 billion rand ($US245.2 million).
The plant would produce 185,000 pounds of uranium yellow-cake a month or 2.2 million pounds a year, at a cash cost estimated at $US30 to 35 per pound. The yellow-cake would be exported, and there were no immediate plans for it to be enriched in South Africa, Mr Briggs said.
"It (the deal) crystallises out uranium assets and puts money into Harmony's pockets to support its existing capital projects," Mr Briggs told a teleconference.
Analysts welcomed the deal, saying it was a good step in the Harmony's stated aim of reviewing its entire operations.
