21st Oct 2013 10:35
LONDON (Alliance News) - Nyota Minerals Ltd Monday said key strategic partner Centamin PLC reduced its shareholding in the company, a move that comes days after Nyota rebuffed Centamin and signed development partner deals with another company.
The gold exploration and development company operating in East Africa said that Centamin sold 20 million shares in Nyota Thursday and Friday, lowering its holding to 151 million shares or 17.2% of the company's issued share capital. A spokesman for Nyota declined to comment on why Centamin reduced its stake in the company.
Nyota last week said it has signed two agreements with a new development partner for its Tulu Kapi Gold Project in Ethiopia but a spokesman told Alliance News at the time that the sales deal was not with Centamin, which was one of the key players in discussions over Nyota's future.
Centamin recently called for the removal of Nyota Chief Executive Richard Chase in an attempt to salvage a deal between the two miners.
Nyota said a number of conditions must be satisfied before the Tulu Kapi deal can go ahead. Both parties must complete due diligence, and the new partner must confirm it has sufficient funding to execute a work programme necessary to maintain the licence at Tulu Kapi.
Nyota said it is the intention of both parties to complete the sale by the end of this year, assuming approval by Nyota's shareholders.
The company had said it would run out of cash by the end of September, but in a recent statement said cost cutting and careful management of its spending means it has enough to get it through to the end of October at least. Its cost cutting has included reducing fees paid to its directors by half.
Nyota said in September that, due to the failure to develop Tula Kapi at that point, the company expects its 2013 financial report to include a non-cash impairment charge of AUD45-55 million and had put the site into care-and-maintenance until a definitive plan was agreed.
Nyota shares were down 14.9% to 1.03 pence, putting it in the top five AIM losers and Centamin shares were up 3.4%, making it the top FTSE250 winner Monday.
By Tom McIvor; [email protected]; @TomMcIvor1
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