20th Feb 2015 15:46
LONDON (Alliance News) - Vast Resources PLC shares rose Friday after the company said it is selling its non-core Zambian assets, which include the Kalengwa mine and other copper based assets in the countyr, for USD1.1 million to RGS Trading, and has also entered into an earn-in arrangement for the continued exploration of the Nkombwa Hills project.
Vast Resources, a resource and development company formerly known as African Consolidated Resources PLC, said that under the deal it has agreed to sell its 96%-owned subsidiary, African Consolidated Resources Zambia Ltd, as well as its remaining directly owned Zambian copper interests, which include its contract to acquire the Kalengwa mine. RGS Trading will then be responsible for all ongoing activity on the litigation concerning the Kalengwa mine and also for the payment obligations.
At the end of September, the carrying value for the assets being disposed was USD536,558, with losses attributable to the assets for the year to end March 2014 of USD242,142.
It said the disposal of its non-core Zambian assets is in line with its plans to accelerate its activities in Romania and the Pickstone-Peerless Gold Project in Zimbabwe.
"Over recent months our attention has turned toward high value brownfield assets with the ability to generate material cash flow in the near term. With these criteria in mind, the Baita Bihor Polymetallic Mine in Romania and the Pickstone-Peerless Gold Project in Zimbabwe have been prioritised for accelerated development," said Chief Executive Roy Pitchford in a statement.
Vast said that subject to satisfactory due diligence and the subsequent acquisition of an interest in Baita Bihor, the company is targeting commercial production from both Baita Bihor and Pickstone-Peerless by the second half of 2015.
The company also said that it has entered into an earn-in arrangement with private exploration company Kilimire International Ltd, for the continued exploration of the Nkombwa Hills project for rare earths and phosphates. Under the agreement, operational responsibility for exploration of the licence area will be taken over by Kilimire. At the end of September 2014, the company's carrying value of the Nkombwa mine was USD73,504.
Vast shares were trading 8.9% higher Friday afternoon at 0.670 pence.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
Copyright 2015 Alliance News Limited. All Rights Reserved.
Related Shares:
Vast Resources