JOHANNESBURG (miningweekly.com) – The International Finance Corporation (IFC) was considering acquiring a 10% stake in gold exploration company Nyota Minerals for about £3,4-million, which could "pave the way" for potential debt financing of Nyota's Tulu Kapi project, in Ethiopia.

The Aim-listed company told shareholders in a statement on Wednesday that it had signed a letter agreement with the IFC, which set out the latter's intention to acquire the 10% shareholding.

The deal was subject to approval by the IFC's board, as well as the approval of Nyota's shareholders, approval by the Australian Foreign Investment Review Board and the conclusion of formal subscription documentation.

"We have carefully considered the merits of making a placement of this nature at this stage in the company's growth and decided that the short-term support the IFC can provide to us in Ethiopia is significant. Importantly, we also believe that engaging with the IFC at this point in time places the company in a very strong position to secure debt financing from them for the construction of a mine at Tulu Kapi, if required," Nyota CEO Melissa Sturgess said.

Further, in addition to the initial investment, the IFC would also be given the option to participate in each Nyota new share placement to investors, to maintain its shareholding at 10%.

Meanwhile, Nyota would be expected to meet the IFC's environmental and social performance standards in the future development of its projects.

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