Business
Tominskoye Sale Agreement
Tominskoye Sale Agreement.
About this update from Cerillion Plc
[{"type":"text","content":"\n Celtic Resources Holdings PLC\n05 November 2007\n\n\n\n\n Celtic Resources Holdings Plc\n (\"Celtic\" or \"the Company\")\n\n Agreement to sell stake in Tominskoye\n\n\nCeltic is pleased to announce the proposed sale of its 70 per cent stake in the\nTominskoye copper project (\"Project\") to a subsidiary of The Russian Copper\nCompany (\"RCC\"). Anime Global Limited (\"AGL\"), Celtic's joint venture partner in\nthe Project, is also selling its 30 per cent interest in Tominskoye to RCC as\npart of the transaction.\n\nThe consideration received by Celtic and AGL at completion will be approximately\nUS$25 million in cash (Celtic share US$17.5 million) (the \"Disposal\"). The\npurchase price may be adjusted after completion, depending on the results of a\njoint drilling programme to determine the actual copper tonnage present in\nTominskoye. The costs of this exploration programme are currently estimated by\nCeltic to be US$1.9 million, of which Celtic will fund 35 per cent. The possible\nadjustment will operate as follows:\n\n• If the exploration programme determines that the deposit contains in\nexcess of 1.3 million tonnes of copper, total additional consideration of\nUS$19.03 for each tonne of copper above 1.3 million tonnes will be payable,\nof which Celtic will receive 70 per cent and AGL 30 per cent.\n\n• If the exploration programme demonstrates that there is less than 1.3\nmillion tonnes of copper, RCC will have the right to reclaim up to $5\nmillion of the initial consideration paid to Celtic and AGL at a rate of\nUS$19.03 for each tonne of copper below 1.3 million tonnes.\n\nThe minimum sum which Celtic will receive for its stake in Tominskoye will be\nUS$14 million and there is no limit on the maximum amount which Celtic may\nreceive.\n\nThe Disposal is conditional, among other things, on the approval of Celtic's\nshareholders. It is expected that a circular setting out the terms of the\nDisposal and a notice convening an extraordinary general meeting of the Company\nwill be sent to shareholders in due course.\n\nCommenting on the Disposal, Kevin Foo, Managing Director of Celtic, said, \"This\ntransaction further demonstrates our ability to add value for shareholders. Once\nthe Disposal is complete, we will have raised approximately US$44 million in\ncash from the sale of assets which came into the Celtic Group th...