Metals One (MET1 ) has confirmed that creditors of Barbrook Mines Ltd have approved the business rescue plan in which it has been involved, with a view to acquiring a significant interest in sizeable South African gold assets.
Lions Bay Resources, in which Metals One holds a 30% stake with the option to go to 49%, is proposing to acquire certain assets of Barbrook Mines Ltd and Makonjwaan Imperial Mining Company Ltd (MIMCO) for US$17 million.
Although the Barbrook portion was approved, a motion was proposed by a creditor of MIMCO to adjourn its meeting of creditors until 8 May 2026. The motion was carried and the business rescue practitioner adjourned the meeting until such date.
Lions Bay Resources will now settle with Barbrook’s creditors. Staff will be paid 100% of their entitlements, less any amounts previously settled by the major creditor. Other creditors will be paid 10% of their approved claims. The 90% balance will be paid to creditors once the Section 11 application, relating to the transfer of mining rights, has been granted.
The first two sets of payments will be funded from LBR's existing cash held in escrow.
It is expected that the major payment will be funded through one of the various funding offers Lions Bay Resources has received from third parties.
Metals One has also been made aware of pending litigation in relation to assets of Vantage Goldfields Ltd, Barbrook and MIMCO, which have been grouped as “the Vantage assets”. Certain stakeholders and other interested parties are seeking to convert the business rescue proceedings in respect of the Vantage Assets into provisional liquidation proceedings and to remove the business rescue practitioner.
The Johannesburg High Court has ordered that the legal proceedings be suspended for a period of three months to allow for the offer by Lions Bay Resources to acquire Barbrook and the MIMCO assets to be considered by creditors.
The acquisition of the Barbrook assets by LBR may be subject to further legal proceedings, including an adverse order pursuant to the legal proceedings and potential litigation by dissenting creditors and other interested parties to seek the setting aside of the approved business rescue plan and challenges to the section 11 approval by the Minister of the Department of Mineral Resources and Energy.
Metals One understands that LBR has taken legal advice in relation to the legal proceedings and has been advised that the pending matters are without merit.
View from Vox
It’s a complex process getting assets out of business rescue in South Africa, as it would be anywhere. Lions Bay Resources looks to be making good progress in the face of some opposition, which is perhaps not surprising, since the completion of the full acquisition would be transformational for the company and, by implication, Metals One. The assets in question include plant and a 2.1 million ounce historical resource, a combination which packs some punch, given that gold continues to push towards US$5,000.