24th Aug 2015 08:32
LONDON (Alliance News) - African Potash Ltd Monday said it has signed a memorandum of understanding with a Zambian fertiliser supply company which will lead to the company supplying over 50,000 metric tonnes of fertiliser a year.
African Potash shares were up 57% to 1.65 pence per share on Monday morning.
This is the first MOU to be signed since African Potash struck a deal with the Common Market for Eastern and Southern Africa (COMESA) and the Mask Africa Crowd Farm Fund Ltd with a view to creating a production and distribution platform for fertiliser in Eastern and Southern Africa earlier in August.
That original deal with COMESA was the first of its kind. It was a three-year agreement whereby African Potash will supply at least 500,000 metric tonnes of fertilisers on an annual basis to off-take partners identified and introduced by COMESA.
Under the MOU with the unnamed Zambian supply company, African Potash will supply in excess of 50,000 metric tonnes per year, with the first delivery expected to happen in September, it said.
Further MOU's are being negotiated as the company aims to hit the 500,000 tonne COMESA target.
"The signing of this trading MOU is a landmark for African Potash in its strategy to become a vertically integrated African focused fertiliser business. It is also a significant leap for agriculture in the COMESA region," said Chairman Chirs Cleverly.
The MOU is subject to the company and the fertiliser supply company entering a definitive agreement.
By Joshua Warner; [email protected]; @JoshAlliance
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