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Caledonia Mining Corporation Plc has signed a conditional agreement to sell its Zimbabwean subsidiary, Caledonia Mining Services (Private) Limited (“CMS”). CMS, which owns and operates the 12.2MWac solar plant powering the Blanket Mine, will be sold to CrossBoundary Energy Holdings (“CBE”) for $22.35 million in cash. Under the terms of a power purchase agreement, the solar plant will continue supplying electricity to Blanket Mine.
The construction of the solar plant was originally funded through a 2020 registered share offering in the U.S., raising $13 million from the issuance of 597,963 shares.
Since its commissioning in February 2023, the solar plant has generated over 47,350MWh of electricity, contributing $728,023 in profits for the year ending December 31, 2023. The power generated has significantly reduced reliance on diesel generators and grid electricity at Blanket Mine, meeting approximately 20% of the mine’s daily energy needs. Under an exclusive power purchase agreement, the plant will continue supplying energy to Blanket Mine.
Proceeds from the sale will be reinvested into Caledonia’s other projects, which are expected to deliver higher returns to shareholders, while allowing management to focus on its core gold mining and exploration business.
CrossBoundary Energy (CBE) is a leading provider of distributed renewable energy solutions for businesses across Africa. CBE delivers cleaner, more affordable energy through power purchase and lease agreements, offering fully financed renewable solutions that help clients avoid upfront costs and technical risks. CBE designs, builds, finances, and maintains customized energy systems to meet client needs.
Launched by CrossBoundary Group in 2015 as Sub-Saharan Africa’s first fully financed commercial-industrial solar provider, CBE operates in more than 14 African countries and manages a diverse portfolio of renewable energy projects. Its clients include mining companies, local manufacturers, and multinational corporations such as Diageo, Heineken, and Unilever. Completion of the sale is contingent on regulatory approvals and the installation of upgraded equipment, which are expected to take a few months.
Mark Learmonth, Chief Executive Officer, said,
“We are pleased to have signed this agreement to sell the solar plant which, upon completion, will enable us to redeploy capital to our core business of mining.
“Whilst the sale will generate an immediate profit for the Company, more importantly we have identified an experienced partner in CBE which brings vast expertise in delivering and running renewable energy projects.
“We look forward to developing a strong relationship with CBE – we are already working with them to deliver a meaningful extension to the plant, and we will be considering renewable energy solutions at our other development projects in due course.”
Matthew Tilleard, Managing Partner at CrossBoundary Energy, said:
“CrossBoundary Energy’s mission is to provide affordable, clean power solutions to underserved markets, and we achieve this by deploying capital into energy projects that enable businesses to focus on their core operations. Our partnership with Caledonia demonstrates the efficacy of this model for the mining sector, benefiting the mine’s operations and ultimately enabling sustainable mining. We look forward to pursuing these acquisitions with miners across the continent.” |
