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[February 2009]
AMCOL Amends Agreement to Acquire Interest in South African Chromite Mine
AMCOL International Corp (Hoffman Estates, IL, USA) has just announced that Chrome Corporation Ltd and AMCOL have amended the agreement pursuant to which AMCOL will acquire an interest in a chromite mine in the Republic of South Africa. Chromite ore is a feedstock used to produce chrome sand. AMCOL currently markets chrome sand to the metalcasting industry in the USA.
Under the terms of the amended agreement, AMCOL will purchase a 53% interest in a holding company that holds a 74% interest in the chrome mine for approximately US$14.0 million. The transaction is not contingent on any additional consents or approvals and is expected to close on or before 25 February 2009. In addition, AMCOL will acquire an option to purchase Chrome Corporation's remaining 47% interest for US$12.4 million at any time during the next two years. If AMCOL does not exercise its option, the amended agreement provides that Chrome Corporation has the right to put its remaining 47% interest to AMCOL for US$12.1 million at any time within 60 days after the expiration of AMCOL's option. A South African Black Economic Empowerment Enterprise will own the remaining 26% interest in the chrome mine.
Gary Castagna, President, Global Minerals & Materials, commented: "This investment provides AMCOL the opportunity to be an integrated supplier of chrome sand to steel foundries. Not only will we be committed to providing the highest quality product in the industry, our technical services will meet the same exemplary standard for which we are known in the green-sand foundry market. We expect to rapidly develop the business since mining has already commenced at the site. Initially, we will process the ore at a smaller-scale facility; however, in the near future, we expect to invest in a world-class plant with upgraded process technology".
AMCOL produces and markets a wide range of specialty minerals and materials used for industrial, environmental and consumer-related applications. It is the parent of American Colloid Co, CETCO (Colloid Environmental Technologies Co), CETCO Oilfield Services Co and the transportation operations, Ameri-co Carriers Inc and Ameri-co Logistics Inc.
ENDS