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Mongolia Growth Group Ltd. Announces the Sale of Mandal General Daatgal LLC
Mongolia Growth Group Ltd. Announces the Sale of Mandal General Daatgal LLC Ulaanbaatar, MON...
About this update from Mongolia Growth Group Ltd.
[{"type":"text","content":"Mongolia Growth Group Ltd. Announces the Sale of Mandal General Daatgal LLCMongolia Growth Group Ltd. Announces the Sale of Mandal General Daatgal LLC\nUlaanbaatar, MONGOLIA, November 25, 2013 /FSC/ - Mongolia Growth Group Ltd. (YAK - TSX Venture),(\"MGG\" or \"the Company\") is pleased to announce that UMC Capital LLC (\"UMC Capital\") has agreed to purchase 100% of Mandal General Daatgal LLC (\"Mandal\"), subject to the approval of the TSX Venture Exchange, the Financial Regulatory Commission of Mongolia and the satisfaction of certain closing conditions.\nOver the course of 2013, the management and board of directors of MGG has determined that, while Mandal has continued to make progress, it is non-core to the Company's much larger property business that has been created over the past two and a half years. This sale will allow the management of MGG to focus its energy, corporate resources and capital on its core commercial real estate business with the goal of creating the most successful institutional property company in the rapidly growing economy of Mongolia. \nThe benefits of this divestiture will accrue to both MGG and Mandal.\nIn the case of MGG, it will lead to;\n* The release of capital to re-invest in the property business,\n* Substantial annual cash savings in the form of reduced audit, compliance, legal and other expenses along with the retention of rental payments from Mandal at market rates,\n* Approximately Cdn$85,000 in stock option expense savings in the year 2014,\n* More predictable revenues and expenses by focusing MGG exclusively on the property sector,\n* Financial statement simplicity as they will relate entirely to the property business, and\n* Streamlining the business from the perspective of potential lenders to property assets.   \nIn the case of Mandal, it will lead to;\n* More direct incentivization of management through the direct ownership of Mandal. Employees of Mandal will be involved in the management group that will be buying Mandal from MGG, and\n* Ability to access more diversified forms of growth capital. \nUnder the terms of the agreement, MGG has agreed to sell 100% of its shares in Mandal General Daatgal LLC to UMC Capital LLC for gross proceeds of approximately 5.90 billion Mongolian Togrog (approximately Cdn$3.50 million), representing a surplus of approximately 900 million ...