15th Jul 2014 11:27
LONDON (Alliance News) - CEB Resources PLC saw its shares jump Tuesday after it said it sold its entire investment in the Mariola Thermal Coal Project in southern Poland to Balamara Resources Ltd at a premium.
CEB Resources acquired an initial 10% stake in Polish mining company, Carbon Investment Soo, which controls the rights to the Mariola Thermal Coal Project, in February. It bought the stake for GBP200,000 in cash plus 20 million CEB shares, and under the terms of the option agreement with Carbon investment, held the right to increase its shareholding to 49% of Carbon Investment's share capital.
In a statement Tuesday, the resource development company said that following an approach from Balamara Resources to acquire the investment, it has agreed to assign the option agreement to Balamara. Balamara Resources is CEB Resources farm-in partner at its Peelwood Base Metal Project in Australia.
CEB Resources shares were up 12.9% at 0.350 pence Tuesday.
Under the deal, Balamara is to pay AUD100,000 or approximately GBP55,000 in cash to CEB Resources, plus 15 million Balamara shares with a value of approximately GBP643,500.
In addition, the 20 million CEB ordinary shares previously issued to Carbon Investment under the terms of the Option Agreement will be returned to CEB and cancelled.
CEB said it considers the assignment to Balamara in its best interests, as its at a significant premium to the amount it initially paid for the investment.
"In addition to this external validation of CEB's Polish activities and in excess of a threefold return on the Polish investment, the company is now well placed to evaluate a growing number of other commercially attractive investment opportunities including CEB's Peelwood base metals project in Southern NSW," said Chairman Cameron Pearce in a statement.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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