Amcol looks to buy stake in chromite mine

Specialty minerals producer Amcol International Corp. said Monday it will buy a stake in a chromite mine in South Africa for about $14 million.

Amcol intends to purchase a 53 percent stake of a holding company which owns a 74 percent stake in the chromite mine. The deal is expected to close by Wednesday.

Separately, Amcol will also have an option to buy Chrome Corp.'s remaining 47 percent interest in the mine for $12.4 million over a two-year period. If Amcol does not pursue that option, Chrome has the right to put its share up for sale.

A South African Black Economic Empowerment Enterprise will own the remaining 26 percent interest in the mine, Amcol said.

Chromite ore is a raw material used to produce chrome sand. Amcol currently markets chrome sand to the metalcasting industry in the U.S.

Shares of Amcol fell 80 cents, or 6.3 percent, to $11.94 in morning trading. The stock earlier hit a new year low of $11.82. It has ranged from $12.18 to $38.38 over the past year.