Friday, December 15, 2017

Newcrest agrees to sell interest to Ivory Coast

NEWCREST has signed an agreement to sell its 89.89 per cent interest in the Bonikro operation in Ivory Coast to a consortium.
The consortium consists of Forbes and Manhattan Gold Resources Ltd and Africa Finance Corporation.
The consideration comprises:

US$72mil (K226.52 million) cash payable on transaction completion, part of which is contingent on the successful progression of the Akissi-so pit extension; and,
Net smelter royalty on future ore mined at the Bonikro lease, with an estimated value of US$9 million (K28.31mil).
Newcrest in a statement noted that the sale of the Bonikro operation followed a strategic review of the asset by Newcrest.
Newcrest managing director and chief executive officer Sandeep Biswas, said: “Following this extensive review, we are pleased to be able to announce the sale of Bonikro to a consortium having the operating experience of the Forbes and Manhattan Group and the financial backing of the Africa Finance Corporation.
“This outcome delivers value for Newcrest shareholders and provides a clear future path for the Bonikro mine for the benefit of its employees, the community and all our Côte d’Ivoire stakeholders.”
The economic effective date for the transaction was Oct 1 this year.
Production until transaction completion will be included in Newcrest’s production results. But the economic interest for the period after Oct 1 will be to the benefit of the acquirer.
Newcrest’s guidance for FY18 will be updated following transaction completion. It is expected that the transaction will be completed next March. Subject to completion and the timing thereof, Newcrest is expected to recognise a small net profit on sale after taking into account the sales proceeds less written down value of the assets sold, transaction costs and a foreign currency translation reserve gain.
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