Aranjin Resources Announces Sale of Brazil Subsidiary
Ulaanbaatar, Mongolia--(Newsfile Corp. - July 21, 2020) - Aranjin Resources Ltd. (TSXV: ARJN) (the "Company" or "Aranjin Resources") announces that it has concluded an agreement to divest its Brazilian subsidiary, Five Star Mineracao Ltda, to a private investor group for future consideration.
As noted in Company filings over the past 18 months, investor appetite for investment in the diamond mining sector has been very low. The Company has been unable to secure investors to support the development of the Company's Brazil diamond assets, and this situation has been further exacerbated by the COVID-19 public health crisis.
The Company is pleased to announce the sale to a private investor with the expectation that we can recoup some investment through the contingent consideration. We have transferred all related assets and liabilities to the purchaser.
The total consideration payable by the purchaser is composed of a cash payment of up to C$4M plus a 1% NSR on any production at the Catalão Project, based on future sales locally or exported.
The cash payment portion of the purchase price will be due when the Catalão Project becomes operational, per below:
- C$500,000 within 6 months after start of commercial production of Alterated Zone;
- C$500,000 within 12 months after start of commercial production of Alterated Zone;
- C$1m within 6 months after start of commercial production of Fresh Rock;
- C$2m within 12 months after start of commercial production of Fresh Rock.
Mr Wood, Chairman of Aranjin Resources stated, "We are very pleased to be able to divest our diamond assets whilst maintaining upside to potential development scenarios in the future. Aranjin Resources will now be exclusively focused on discovering copper deposits in the world class and underexplored copper provinces of Mongolia. Exploration programs have commenced and additional acquisition opportunities are being assessed."
On behalf of the Board
Aranjin Resources Ltd.
NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
Correction of finder's fees
Further to the announcement on July 3, the Company wishes to provide a correction to the cash compensation amount paid to eligible finders in connection with the closing of the financing, as the Company paid C$38,761.25 in cash compensation as opposed to C$38,860 as announced in its July 3, 2020 news release.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/60226