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Premier Danakil acquisition receives TSX approval

9th May 2014

By: Leandi Kolver

Creamer Media Deputy Editor

  

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JOHANNESBURG (miningweekly.com) – Aim-listed Premier African Minerals on Friday announced that its 30% acquisition of the Danakil potash project, in Ethiopia, from Toronto-listed AgriMinco had been approved by the TSX, following the transaction’s approval by AgriMinco’s independent shareholders.

In terms of the C$4.9-million option agreement, Premier would buy the entire issued share capital of Mandalore Development, a wholly owned subsidiary of AgriMinco, which owned a 30% interest in Danakil.

Premier also reported that all the conditions precedent of its interest-free term loan of $2.5-million, repayable on December 31 to AgriMinco’s joint venture partner in the Danakil project, Circum Minerals, had been satisfied.

This bridge loan would enable Premier to exercise the option agreement.

Premier had also granted Circum an option, valid until June 5, which stipulated that in the event that Premier exercised the Mandalore purchase option, Circum could subsequently acquire Mandalore from Premier.

The Circum call option was exercisable at the sole discretion of Circum and was subject to conditions precedent, which included the completion of due diligence by Circum.

Under the Circum call option, Premier would receive an amount in cash on completion equal to the amount advanced to Premier under the bridge loan, new Circum shares and further deferred consideration payable in either cash or Circum shares, which was expected, in aggregate, to be no less than the consideration paid by Premier to AgriMinco.

Edited by Tracy Hancock
Creamer Media Contributing Editor

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