[miningmx.com] — Chrometco, the exploration and development company, on Tuesday said it would ask its shareholders to vote on the sale of its Rooderand to DCM Chrome for R62m.
The company has been negotiating the sale of the assets since 2007 and
has now been advised by the JSE that the transaction requires shareholder
approval.
Other conditions precedent which remain outstanding are the conversion of the old order mining rights, relevant to the Rooderand assets to new order mining rights and ministerial approval for the transfer of the rights.
In terms of the sale agreement entered into by the parties in 2007, Chrometco envisages selling its equity holdings in its two wholly owned subsidiaries, Korpo Trust and Rooderand Chrome, through which it holds the Rooderand assets to DCM.
Chrometco said the selling price of R62m is reduced by payments made by DCM in terms of the mining and management agreement that allows DCM to mine the Rooderand assets.
In terms of this agreement DCM is obliged to pay Chrometco an amount
equal to R13m annually for the right to mine and for mining activities at Rooderand.
Chrometco said it has three payments from DCM.
“Should the conditions precedent to which the sale agreement is subject not be fulfilled, then Chrometco will investigate other opportunities in relation to the residual value of the Rooderand assets,” the company said.
