HOUSTON (ICIS)--Canadian fertilizer developer AgriMinco announced on Friday that regulators with the TSX Venture Exchange have approved the sale of the company’s 30% interest in the Danakil potash project in Ethiopia to Premier African Minerals.
On 8 May AgriMinco announced its shareholders had also approved the transaction. Per the agreement, Africa-based fertilizer developer Premier will also give up its 42% interest in AgriMinco as part of the deal.
Premier will pay an estimated Canadian dollars (C$) $4.9m, ($4.5m), which would cover the cancellation for no consideration of its shareholding in AgriMinco, settle any debt obligations up to C$1.5m and issue to AgriMinco new Premier shares equal to C$1m, in exchange for the interest in Danakil project.
In March, Premier entered into an option agreement whereby AgriMinco granted the company an exclusive option to purchase 100% of the shares of Mandalore Developments, AgriMinco's wholly-owned subsidiary that holds the stake in the project.
In early May, Premier revealed it had reached a loan agreement with Circum Minerals for $2.5m to fund its option on the stake in the project.
Circum owns the remaining 70% of Danakil and is also being granted an option to buy Mandalore from Premier at a price equivalent to the loan in cash or shares. Circum can exercise its option until a 5 June deadline.
($1 = C$1.09)