Shanta Gold, East Africa-focused gold producer, has completed the acquisition of 100% shares of Barrick’s subsidiary Acacia Exploration Kenya (AEKL) from three subsidiaries of Barrick Gold.
With the receipt of regulatory approvals in Kenya, including standard consents from the Mining Authorities to the assignment of interests and the transfer of Prospecting Licences, and approval of the Transaction by the Competition Authority of Kenya, all of the closing conditions for the Transaction are now satisfied.
The purchase consideration is comprised of $7.0 million cash (inclusive of $0.5 million which may become payable post completion subject to satisfaction of a condition subsequent), $7.5 million shares in Shanta Gold issued to Barrick issued at 10.5% per share, and a two percent life of mine net smelter return (NSR) royalty over the Project. Accordingly, 54,650,211 shares in Shanta Gold have today been issued to Barrick resulting in a pro forma interest of 6.4% in Shanta Gold.
Pursuant to the terms of the acquisition, Shanta has also inherited certain liabilities of AEKL and the consideration has been adjusted to reflect certain working capital items, the net impact of which is an additional cash sum payable by Shanta to settle third party liabilities of $1.3 million. The cash component of the consideration has been adjusted down by $0.5 million which may become payable within 4 years subject to completion of a condition subsequent.
Shanta Gold Limited is a gold mining company, registered in Guernsey in the Channel Islands but which operates in Tanzania. The company is listed on AIM on the London Stock Exchange and had a market capitalisation of £63.5M as of 18 September 2013. The Tanzanian offices are in Dar Es Salaam.
Shanta’s most important project is New Luika Gold Mine, in the Lupa Gold Field of south western Tanzania, which saw its first gold pour in August 2012. The company’s mines are all currently in Tanzania but projects elsewhere in East Africa are envisaged. Shanta sub-contracts all aspects of the mining process in order to shorten the time taken for a new mine to become productive.
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