Business
Mozambique Government approve Manica acquisition
Mozambique Government approve Manica acquisition.
About this update from Xtract Resources Plc
[{"type":"text","content":"\n \nRNS Number : 5493Q Xtract Resources plc 01 March 2016 \n\n1 March 2016\n \nXtract Resources Plc\n(\"Xtract\" or \"the Company\")\n \nMozambique Government approve sale of Manica Gold project to Xtract \n \nXtract Resources Plc (AIM: XTR), the gold mining and development Company has received final approval under the Mozambique Mining Act from the Mozambican mining authorities to complete the acquisition of 100% of the Manica gold project in Mozambique (\"Manica\") from Auroch Minerals NL (\"Auroch\") (the \"Transaction\"). This was the final outstanding approval and all conditions have now been fulfilled in order to complete the Transaction. \n \nXtract is also pleased to announce that following discussions with Auroch both parties have agreed to revise the terms of the Transaction, further details of which are set out below. Completion of the Transaction will now occur upon the payment of US$3.0 million by the Company to Auroch (the \"Consideration Cash\"), which is expected to occur on 1 March 2016.\n \nOn 10 September 2015, Xtract announced that it had agreed revised terms for the Transaction which were as follows:\n· Issue Auroch 1,032,258,065 new Ordinary Shares, to the value of US$4 million, at Completion plus a 3 month lock in from issuance\n· Pay cash of US$3.5 million at Completion \n· Pay Auroch US$2 million in cash three months after Completion (Xtract expects to fund this cash payment from project finance which is currently being negotiated with a number of lenders or from current cash flow)\n· Assume responsibility to settle the remaining US$1 million of Manica project creditors (a cash payment of US$0.5 million has already been made to Auroch to settle certain Manica project creditors)\n· Assume responsibility for any tax liability relating to the capital gain due on the disposal of the asset. In January 2016, Auroch received a final ruling from the Honorable President of the Mozambique Tax Authority, who determined a total of US$0.7 million due in capital gains tax. As per the terms of the Transaction at that time, Xtract paid capital gains tax and a further US$0.05 million to Auroch\n \nUnder the revised terms the Company wi...