LONDON, UK: Kazera Global plc has signed a definitive settlement to promote its 100% curiosity in African Tantalum (Proprietary) Limited to Hebei Xinjian Construction for money consideration of USD13 million. This transaction supersedes the transaction introduced on 20 July 2022.
Highlights
- The settlement comprises the sale of all of the shares and related loans in Aftan for money consideration of USD13,000,000. Kazera will retain the proper to obtain a debenture payment equal to 2.5% of product gross sales of produced Lithium & Tantalum for the lifetime of the mine.
- Full operational administration will pass to Xinjian on the efficient transaction date, with 100% possession of the shares solely passing as soon as Kazera has been paid in full for each the mortgage and the share sale anticipated by [DATE].
- This transaction represents the primary profitable realization of returns on a strategic funding made by Kazera. The strategic exit will allow Kazera to make investments in its different projects, principally the thrilling Heavy Mineral Sands alternative in South Africa, with out the necessity for additional capital raising.
- Management consideration will now be freed as much as focus on additional strategic investment opportunities.
- Heavy Mineral Sands operation now in manufacturing with 2022 targets already comfortably met.
Dennis Edmonds, Kazera Chief Executive Officer, commented: “This is a hugely significant second for Kazera, and I am very happy to announce this sale delivering USD13m in money to the Company. We have been working with Xinjian under the JV since July and are assured of their ability to progress the asset through its subsequent development phase, while we retain publicity to its rising money flow profile through the debenture stream.
This represents an actual milestone for Kazera because the primary realization of returns from an funding in line with our stated technique as an investing firm of constructing worth in our investments while sustaining flexibility for opportunistic exit points. This strategic exit will additionally allow administration to focus on our existing projects and additional potential investments. We see main alternatives within the current environment and look ahead to delivering sustainable growth to the profit of all our stakeholders within the close to term.
I would additionally like to thank our team in South Africa for his or her tremendous efforts in bringing Walviskop into production. The entire team recognises the importance of this project, not simply to the Company, however additionally to the Richtersveld community, who’ve been extremely supportive of Kazera and the project.”
Transaction overview
Kazera has entered into an settlement with Xinjian for Xinjian to buy all shares and claims in Aftan for an aggregate consideration of USD13,000,000 comprised of buy consideration for the sale of the shares in Aftan of USD3,642,207 and the repayment of the intercompany mortgage to Kazera of USD9,357,793. Payment of the full sums is as follows:
USD642,207 has already been paid by Xinjian, with USD500,000 to be received earlier than the finish of December 2022 and a additional USD2,500,000 to be paid by the finish of January 2023. The balance of USD9,357,793 will be payable in equal month-to-month instalments commencing in April 2023 and terminating in December 2023. Outstanding quantities will attract curiosity at a rate of 8% p.a.
Aftan is the holding firm for Kazera’s curiosity within the Tantalum Valley Mine in Namibia. To the year ended 30 June 2022 Aftan reported a loss earlier than tax of N$6,963,023.
When approached by Xinjian to consider the outright sale of Aftan in place of the beforehand introduced investment, the Board of Kazera carefully considered the deserves of an sooner than initially anticipated exit from this investment. It is the perception of the Board that this sale offers the chance to exit an funding for an attractive return and, extra importantly, enables Kazera to make investments within the Company’s Diamond and Mineral Sands projects, the latter which offers a tremendous money flow profile and now with out the necessity to raise additional capital. It additionally positions the Company to return worth to shareholders, and the Board is examining choices to allow this within the future. In addition, the sale removes the dangers related to the development of a brand new processing plant and recommissioning the mine within the current unsure market environment.
Update on Walviskop Heavy Mineral Sands project
In South Africa, the Company is happy to announce that it has comfortably exceeded its goal of manufacturing 1,000 tons of bulk Heavy Mineral Sands on the Walviskop mine by the finish of 2022, and has already constructed up a stockpile of almost 5,000 tons. Offtake discussions are well superior with three different parties, all of whom have expressed curiosity in shopping for the majority product with a view to entering proper into a contract sooner or later to buy the product within the type of refined minerals, which attract a premium price.