LONDON, UK: Zanaga Iron Ore Company Limited (AIM: ZIOC) introduced that an settlement has been reached with Glencore Projects, for the acquisition of Glencore Projects’ controlling shareholding within the Project, located within the Republic of Congo through the acquisition of Glencore Projects’ 50% plus one share curiosity in Jumelles, an entity which not directly holds the profit of the Project’s mining licence, for a minority shareholding in ZIOC.
Zanaga Iron Ore Company and MPD, an oblique wholly owned subsidiary of Jumelles which holds the profit of the Project’s mining licence, have additionally entered proper into a Marketing Agreement with Glencore International, which will take impact instantly previous to Completion, for the sale and buy of all future iron ore manufacturing from the Project or any different of their or their Affiliates’ assets utilizing similar infrastructure within the Republic of Congo.
Highlights
· Proposed acquisition by ZIOC of Glencore Projects’ controlling shareholding in Jumelles, oblique proprietor of the Project
o Subject to ZIOC shareholder approval, the Acquisition will be concluded through the issuance of 286,340,379 new Shares to Glencore Projects, that are anticipated to symbolize a shareholding of 48.26% in ZIOC on Completion.
o Relationship Agreement to be entered into between Glencore Projects and ZIOC with impact from Completion to make sure that the Company can carry on its enterprise independently of Glencore Projects.
o Glencore Projects will have the proper with impact from Completion to nominate two non-executive administrators to the Board of ZIOC.
o Glencore Projects has agreed that it will not dispose of any of the Consideration Shares within the Company within the six months following Admission with out the consent of the Company (not to be unreasonably withheld or delayed) different than in sure restricted circumstances and to adjust to orderly market provisions within the next six months.
· Marketing Agreement entered into between Glencore International, the Company and MPD which will take impact instantly previous to Completion
o Life-of-mine marketing settlement granting Glencore International the unique marketing proper for all iron ore conforming to sure specs produced by MPD, ZIOC or their respective Affiliates from the Project or within the Republic of Congo utilizing similar infrastructure that’s not topic to existing gross sales arrangements.
o Agreement by Glencore Projects to buy from MPD or the Company the Product, or promote the Product on behalf of the Company on arm’s size terms.
o Glencore International to be entitled to obtain a marketing fee in accordance with the detailed provisions of the Marketing Agreement.
· Funding agreement
o In order to fund the Project’s persevering with work programme and budget, in addition to the working capital necessities of ZIOC, till 31 December 2023, Glencore Projects has agreed to amend the phrases of the Loan Agreement as follows:
§ increase in mortgage quantum from US$1.2 million to US$1.8 million;
§ extension of mortgage repayment date to 31 December 2023.
§ Jumelles may utilise as much as US$200,000 of the mortgage facility to advance loans to ZIOC to fund its working capital.
· General Meeting
o A discover of a general assembly to be convened for on or round thirteen December 2022 will be despatched to Shareholders shortly to hunt authority for the administrators to: (i) issue 286,340,379 Shares pursuant to the Acquisition; and (ii) not require Glencore Projects to make a takeover offer in accordance with Regulation 33 of the Articles in reference to the Acquisition.
Clifford Elphick, Non-Executive Chairman of ZIOC, commented: “The acquisition of Glencore Projects’ shareholding in the Project is a key milestone for ZIOC’s shareholders, demonstrating to 3rd party investors that the Project is now represented by a single entity and administration strategy. The Acquisition is worth accretive to Shareholders and will increase efficient fairness possession of the Project by existing Shareholders, enhancing their look-through possession of the Project and securing administration of the Project with out paying any premium for such interest.
Furthermore, entering into the Marketing Agreement with Glencore International now provides consolation to investors and financiers that the Project’s future manufacturing is underpinned by one of many largest iron ore merchants globally.”