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Caledonia Mining's Jersey switch waved through

The company’s new registered office will be PO Box 218, 43/45 La Motte Street, St Helier, Jersey, JE4 8SD

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The company's shares will continue to be listed on the TSE and the OTCQX

Caledonia Mining (LON:CMCL, TSE:CAL) said the resolution to approve the plan to re-domicile to the Channel Islands was approved at a shareholders meeting on Thursday.

As a result, the company’s new registered office will be PO Box 218, 43/45 La Motte Street, St Helier, Jersey, JE4 8SD.

The company's shares (or depository interests) will continue to be listed and traded on the Toronto Stock Exchange and on AIM and they will continue to be traded on the OTCQX in the USA.

WH IRELAND noted that 96% of the shares represented at the meeting voted in favour of the move, and reiterated its view that the switch to Jersey makes sense as Caledonia’s interests are in Southern Africa with the shareholder base in Southern Africa, UK, Continental Europe as well as North America. 

There will also be cost savings as the company will not be subject to Canadian compliance costs and taxes and future dividends paid to shareholders outside of Canada will not be subject to Canadian withholding tax, the broker noted. 

“In our view this helps streamline the business and tax structure and helps provide a focus on its activities at the expanding Blanket gold mine in Zimbabwe.  The expansion at Blanket continues to raise production from the current ~40koz/a to ~80koz/a gold with perhaps the largest infrastructure project in Zimbabwe at the current time, spending US$70m over six years – all funded,” said analyst Paul Smith. 

“The shaft construction to allow access to the deeper ore in the centre of the ore body is well underway and will provide production infrastructure and access to new resources for years to come. With the increased production beginning to come through from the first completed underground capital projects this year (No 6 Winze resources and the new tramming loop) and an improved gold price outlook Caledonia looks undervalued compared with its peers,” Smith said, as he reiterated his ‘buy’ recommendation and 90p price target. 

Quick facts: Caledonia Mining Corporation PLC

Price: 1345 GBX

AIM:CMCL
Market: AIM
Market Cap: £163 m
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