JOHANNESBURG (miningweekly.com) – Aim-listed Premier African Minerals on Thursday announced that Danakil potash project codeveloper Circum Minerals had exercised its exclusive option to acquire the entire issued share capital of former AgriMinco subsidiary Mandalore Development from Premier, effectively consolidating its ownership of the Danakil project, in Ethiopia.
Premier, earlier this week, acquired Mandalore, which held 30% of the Danakil project, from AgriMinco for a consideration of C$4.3-million, and had granted Circum the call option to, in turn, acquire Mandalore.
As an effect of Circum exercising the option, Premier was immediately paid $2.5-million net of any advance made by Circum to initially allow Premier to acquire Mandalore.
Premier would also be issued two-million new shares in Circum with a present value of $1.4-million, and the company would receive a further $1-million on July 15, September 15, November 15 and January 15.
"Through this transaction, Premier has effectively realised substantial early value from an exploration project in a capital market environment that is simply not supportive of mineral exploration and this sees Premier in an enviable position of not needing to approach the capital markets for normal operating and exploration finance for the foreseeable future.
“With $5-million effectively ‘in the bank’, a retained value in Circum, several advanced exploration projects and our outstanding RHA Tungsten project, in Zimbabwe at a virtual ready to build stage, I feel justified in approaching the future with confidence," Premier CEO George Roach said.