TSX- and Aim-listed gold miner Avesoro Resources has received an expression of interest from its 72.9% shareholder Avesoro Jersey Limited (AJL), which wants to acquire the shares in Avesoro not already held by it.
AJL has offered to buy the remaining shares at £1 apiece.
Avesoro says AJL’s offer is supported by holders of 12.9% of the shares.
The Avesoro board has established a special committee, comprising all the independent directors of the company, to conduct a detailed review and analysis of the offer, with help from legal counsel and financial advisers.
Meanwhile, Avesoro is assessing the longer-term viability of mining operations at the Youga mine, in Burkina Faso, in light of damage sustained to heavy mining equipment and the low grades currently being achieved.
The company confirmed that a number of haul trucks, excavators and auxiliary equipment within the heavy mining equipment fleet had been vandalised beyond repair.
This follows an incident earlier this month whereby security forces in Burkina Faso had to seal off the gold mine, after a security guard killed an illegal miner and local people attacked the site in retaliation, Reuters reported on August 10. The local residents reportedly burned equipment.
Avesoro’s mining contractor for Youga, Orkun Group, is expected to ship additional equipment – five excavators, 15 haul trucks and auxillary equipment – which should alleviate the situation to some extent.
Nonetheless, the company said the significant ore dilution experienced at the Gassore pit at Youga necessitated a review of the operations.
The company also has had no access to ore at the New Liberty mine, in Liberia, and therefore gold shipments in August will be less than 1 000 oz from this mine.
It was initially assessed that the heavy rain at New Liberty and resultant flooding of the main pit would result in ore mining being suspended for about ten days to allow dewatering of the pit; however, as a result of further rainfall and further assessment, Avesoro did not expect to access ore until early September.
As a result of the operational issues, the company’s financing requirement has increased by at least $10-million, compared with previous estimates.
The company had aimed to produce between 180 000 oz and 200 000 oz for the year.
Gold production for July and August is expected to be about 16 000 oz, where the monthly target should be 15 000 oz at least and, therefore, the company has materially reduced its guidance but has not provided figures.