Aim-listed Galileo Resources has noted progress in relation to JSE-listed Afrimat’s option to buy, for R300-million, shares in and shareholder loans made to Glenover Phosphate in which Galileo has a 30.70% direct and a 4.99% indirect investment held via Galagen.

The parties on June 21 signed an addendum to the conditional sale of shares and shareholder loan agreement between Afrimat, Glenover and the shareholders of Glenover, which gave rise to Afrimat’s option, which confirms that the sale claims and share sale consideration will be settled as outlined below.

Firstly, the purchase consideration payable by Afrimat to the Glenover shareholders in respect of the sale claims and Glenover shares will now be settled as a first-tranche payment of R150-million in Afrimat shares.

Moreover, there is a second-tranche payment in respect of the R147-million sale claims payable in cash on April 30, 2024.

Lastly, there is a cash consideration of R3-million payable in respect of the Glenover shares, on fulfilment of the suspensive conditions.

The acquisition of the Glenover shares is subject to the fulfilment of suspensive conditions.

In addition, the addendum provides that, upon payment of the first tranche payment in respect of the sale claims, the parties shall enter into a contract mining agreement whereby Afrimat shall become entitled to begin mining of other minerals in addition to vermiculite.

In December 2021, Afrimat announced that it had bought certain assets and a right to mine select deposits at the Glenover mine, as well as the option to acquire 100% of the shares in Glenover Phosphate from the current shareholders together with all claims that the current shareholders may have against Glenover.

The total purchase consideration for the Glenover acquisition was R550-million, allocated as R250-million for the sale assets and R300-million for the Glenover shares and sale claims.

In August 2022, Afrimat announced that there were no outstanding conditions precedent in respect of the acquisition of the sale assets and that the purchase consideration of R250-million allocated to the sale assets was paid to the Glenover shareholders.

In October 2022, Afrimat announced that the board of directors approved the acquisition of the Glenover shares and exercised the option to acquire the Glenover shares.