2nd Jan 2020 09:49
(Alliance News) - Richland Resources Ltd said Thursday it has finally completed the close of its Capricorn sapphire project in Australia.
The sapphire and gemstone company saw Fura Gems Inc exercise its option to buy the project in mid-July. Then in August, Richland shareholders approved the sale of the project, but closing the deal was subject to a series of extensions.
The final agreement will see Fura pay Richland USD1.3 million in cash, with Richland immediately deploying USD880,000 of this to pay lenders to settle the total amount outstanding under its pre-existing secured convertible loan facility.
"The balance of the consideration will be utilised by the company to pay transaction costs and certain other outstanding creditors and to provide additional working capital as the company seeks to identify a suitable reverse takeover transaction in the mining sector," Richland explained.
Following the deal, Richland has become a cash shell, and it said it will look to secure debt or equity funding to buy a new mining project. The company has six months to complete a deal or its shares will be suspended from trading on AIM. If a deal is not completed in the six months following suspension, its shares will be cancelled.
Shares in Richland Resources were 2.8% higher on Thursday morning in London at 0.14 pence each.
By Paul McGowan; [email protected]
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