Matthew Foy Senior Advisor, Issuers (Perth) Australian Securities Exchange Exchange Plaza 2 The Esplanade PERTH WA 6000
By e-mail
Dear Matthew
Reference: ASX Query
With reference to your letter dated 14 October 2010 we wish to give you some background on the company?s activities leading up to the ASX Announcement entitled ?Final Government Approval obtained for acquisition of Mashala Resources?.
The Company?s aggressive acquisition of producing and near producing coal assets has intensified during this year and has caught the attention of a number of independent resource analysts and share investment newsletters.
We are aware of one such report recommending Continental Coal as a highly attractive investment opportunity that was published after market on 14 July 2010. Immediately following the release of this report and in the absence of any material announcements by the Company, there was a significant increase in both the share price and trading volumes and also a noticeable increase in shareholder enquiries on the 15 July 2010 and 16 July 2010.
Since announcing the proposed acquisition of Mashala Resources on 4 August 2010, the Company has at all times kept the market fully informed with the progress of this transaction with progress updates and announcements of the receipt of key approvals on 16 September 2010, 4 October 2010 and 13 October 2010.
We are aware of an update share investment report and investment recommendation released after market on Friday 8 October 2010 by one such share investment newsletter that could have attributed to the increased trading volumes and share price increases on 11 October 2010 and 12 October 2010. Furthermore, the Company was a presenter at an investment forum ?Coal and Developments Hotspots Conference? in Brisbane on 11 October 2010.
The Company believes that the appreciation in the share price and increase in trading volumes is attributable to the Company?s broader marketing campaign and the success it is achieving in South Africa in its existing coal mining operations and acquisition of Mashala Resources and not just one announcement as referred to in your letter.
Please find below the Company?s response to your specific questions in line with the numbering of your letter:-
1. The Company does consider the Transfer of Rights Information (or any part of it) contained in the Final Government Approval Announcement to be material to the Company.
2. The Company became aware of the Transfer of Rights Information contained in the Final Governments Approval Announcement upon receipt of a copy of the Section 11 approval from our South African based CEO at 9.42pm WST Tuesday night 12 October 2010.
3.& 4. The Company released the Transfer of Rights information pre-market on 13 October 2010.
5. The Company confirms that it is compliance with listing rule 3.1.
CCC Price at posting:
77.0¢ Sentiment: ST Buy Disclosure: Held