PERTH (miningweekly.com) – ASX-listed Mineral Resources has struck an asset sales agreement with fellow listed Resources Development Group (RDG) to divest of its noncore manganese assets in Western Australia.
In return for the manganese assets, Mineral Resource would obtain a 75% interest in RDG, receiving more than 1.89-billion shares in the junior. There would be no cash payable for the transaction.
Subject to the completion of the transaction, Mineral Resources would also provide assistance in the development of a manganese project through a services contract with RDG, and would provide funding assistance through a secured loan to enable RDG to develop a manganese asset.
Mineral Resources’ services would include the design, construction, supply and commissioning of processing and non-processing infrastructure, with the loan consisting of up to A$35-million in funding over a five-year term, and at an interest rate of 8.125% a year.
Mineral Resources chairperson Peter Wade said on Thursday that the restructure of the manganese assets enabled value to be realised while preserving longer-term optionality, at a time when there were significant opportunities within the company’s portfolio.
“Mineral Resources will support RDG in its aspirations to grow the volume and value of project work in the mining, energy and infrastructure sectors at a level that is complementary to Mineral Resources’ own contracting and mining services focus.”
The transaction was subject to RDG shareholder approval.