Caledonia Mining Corporation Plc has entered into a conditional agreement to sell its Zimbabwean subsidiary, Caledonia Mining Services (Private) Limited (“CMS”), to CrossBoundary Energy Holdings (“CBE”) for $22.35 million in cash. CMS owns and operates the 12.2MWac solar plant that powers the Blanket Mine. Despite the sale, the solar plant will continue to supply electricity to Blanket Mine under a power purchase agreement.
The solar plant was initially financed through a 2020 share offering in the U.S., raising $13 million from the issuance of 597,963 shares. Since its commissioning in February 2023, the plant has generated over 47,350MWh of electricity, contributing $728,023 in profits by the end of 2023. This power generation has reduced Blanket Mine’s reliance on diesel generators and grid electricity, meeting around 20% of the mine’s daily energy needs.
The proceeds from the sale will be reinvested into Caledonia’s core gold mining and exploration projects, which are expected to yield higher returns for shareholders. CrossBoundary Energy, a leading provider of distributed renewable energy solutions in Africa, will take over the plant’s operations. CBE specializes in offering fully financed renewable energy solutions through power purchase and lease agreements, helping businesses avoid upfront costs and technical risks.
CBE operates in over 14 African countries and serves a range of clients, including mining companies and multinational corporations like Diageo, Heineken, and Unilever. The completion of the sale is subject to regulatory approvals and the installation of upgraded equipment, expected to take a few months.
Mark Learmonth, CEO of Caledonia, expressed satisfaction with the deal, stating, “The sale will generate an immediate profit for the company and allow us to redeploy capital to our core mining business. We’ve also partnered with an experienced company like CBE, which brings significant expertise in renewable energy.”
Matthew Tilleard, Managing Partner at CrossBoundary Energy, added, “Our mission is to provide affordable, clean power solutions to underserved markets. This partnership with Caledonia demonstrates how our model can benefit the mining sector and enable sustainable mining.”
