Obtala Gets Extension To Commence Acquisition Until April 2019

29th Mar 2018 14:57

LONDON (Alliance News) - Obtala Ltd on Thursday agreed on a twelve-month extension for serving notice to purchase Nouvelle Scierie Moderne de Sassandra.

The investment company, through its forestry subsidiary Argento Ltd, lent NSMS and its owner Sidani Younes USD845,000 to pre-finance the production of timber in the Ivory Coast, in return for exclusivity over this production. Initially, the company expected to be paid back over nine months starting from Saturday.

Younes has agreed to sell 100% of the company if served written notice before April by Obtala's Argento for a price of USD1.2 million, minus the amount of timber bought by Argento in the period from December 16 to the end of March.

Under the new agreement, Obtala can serve written notice via Argento at any time up to April 2019 to purchase NSMS. Also, the loan became repayable in full if the acquisition will not be pursued.

Obtala Chairman Miles Pelham said: "Deliveries from NSMS have commenced but our due diligence process requires more sample data before exercising or terminating our option to purchase 100% of NSMS share capital. We are therefore delighted to have agreed the extension, for no additional consideration, and look forward to working with NSMS on the development on an integrated supply chain for their product throughout 2018."

The stock was trading 1.2% lower at 10.00 pence per share on Thursday.

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Related Shares:

Obtala Resources Ltd