2nd Sep 2015 07:00
LONDON (Alliance News) - StratMin Global Resources PLC on Wednesday said it has agreed a farm in deal with Bass Metals Ltd, a resources company listed on the Australian Stock Exchange.
The deal means that Bass will acquire up to 35% of the interest in the existing Loharano mine and processing operations of StratMin via an initial investment into Graphmada Mauritius.
Graphmada Mauritius is a subsidiary of StratMin. Bass will invest GBP2 million in two tranches for an initial interest of 25% in the subsidiary. It will be able to take a further 10% stake subject to completing the initial investment by November 30. The payment required will be determined depending on StratMin's share price in the event that Bass takes up its option.
"This transaction enables the company to fund the group with investment at a substantial implied premium to the current share price and demonstrates a strong endorsement of our strategy," Chief Executive Brett Boynton said in a statement.
"Working with Bass is a cost effective entry to the very sophisticated graphite and renewable energy investor base in Australia without the cost of a dual listing," Boynton added.
The CEO said the deal reduces funding risk for StratMin by giving it access to a "large and active" graphite investor pool. He added that StratMin can be confident enough to look at more significant transactions as a result of the deal.
"We have an opportunity now to capitalise on the early mover status StratMin has gained and whilst most of our peers are focused on completing feasibility studies and cost cutting, together with Bass, we can work on expanding production from Loharano and developing new opportunities," Boynton said.
By Samuel Agini; [email protected]; @samuelagini
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