African Minerals considers partial sale of Tonkolili stake
JOHANNESBURG (miningweekly.com) – London-listed African Minerals, which holds a 75% stake in the Tonkolili iron-ore mine, in Sierra Leone, is considering the partial sale of its interest in the project, as a means to deal with the immediate liquidity issues facing the project.
Trading in the company’s shares on the LSE was suspended on Thursday while the mine developer and operator sought to clarify its financial position.
African Minerals noted that it continued to engage with Shandong Iron and Steel Group (SISG) over the timing of the release of $102-million in cash, which SISG had, in August, agreed to provide to the company.
“Despite the company’s best efforts to reach an agreement with SISG over the release of these funds, there remains no certainty on the timing of their release,” it stated.
African Minerals had been in negotiations for alternative sources of funding to finance its working capital at Tonkolili in the short term, but said that, despite “intensive efforts”, in the last few days, it had become clear that alternative sources of funding were unlikely to materialise in the near future.
In the absence of the release of the restricted cash or availability of alternative sources of funding, it would now engage with SISG and other parties over the partial disposal of its holding in the Tonkolili mine.
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