28th Apr 2016 09:00
LONDON (Alliance News) - Herencia Resources PLC on Thursday said Next Minerals has pulled out of a deal to buy the Picachos project, leaving Herencia close to running out of cash.
Herencia struck a deal in February which was set to lead to Next Minerals potentially acquiring Herencia's stake in both the Picachos and Pasitzal copper projects in Chile by purchasing the company's Chilean subsidiary, but the deal has faced issues after some of Herencia's shareholders said they would not support the sale in its current form.
On Thursday, Herencia said Next Minerals has now decided against proceeding with the deal.
Herencia said that if the Picachos licence option is not renewed, Herencia will lose all rights to the asset but will have enough working capital to last until the end of May. If the licence is renewed, Herencia will only have enough working capital to last until early May. The company said it has withheld the option payment as it "considers all options".
Herencia shares were down 41% on the news to 0.280 pence.
By Sam Unsted; [email protected]; @SamUAtAlliance
Copyright 2016 Alliance News Limited. All Rights Reserved.
Related Shares:
Herencia Resources