PERTH (miningweekly.com) – ASX-listed Kasbah Resources on Wednesday told shareholders that the company had failed to reach a commercial settlement with BDO Corporate Finance during a Court ordered mediation on April 30.
Kasbah in 2017 filed legal proceedings against BDO, seeking damages for a series of claims, including a breach of contract, negligence and misleading and deceptive conduct associated with BDO’s role as independent expert during the failed 2016 scheme of arrangement with Asian Mineral Resources.
Kasbah and Asian Minerals in August of 2016 entered into a scheme of arrangement under which Asian Minerals would acquire all the shares in Kasbah.
However, by December that year, Kasbah had identified a fundamental error in the valuation methodology applied in BDO’s independent expert review, which changed the company’s opinion of the scheme to “not fair, but reasonable”.
The agreement with Asian Minerals was eventually terminated, following resistance from that company’s shareholders.
Kasbah CEO Russell Clark said on Wednesday that no final agreement was reached with BDO during the court-ordered mediation, with the session adjourned to allow the parties to consider their cases.
The two companies had the opportunity to relist the mediation to continue the settlement discussions.
Meanwhile, Kasbah on Wednesday also reported the increase and extension of its existing loan facility with Pala Investments.
Pala will make available a further A$2-million loan to Kasbah, in addition to the existing A$1-million loan secured in 2016. The funds will be used to finalise a definitive feasibility study on the Achmmach tin project, as well as to meet development expenditure commitments and to cover ongoing working capital.
The loan maturity date has now been extended from the end of June 2018 to the end of December 2018, unless Kasbah completes an equity raise prior to the maturity date, at which point Pala could be requested to be prepaid in full or part.