Spartan Resources sells Glenburgh and Egerton projects to Benz Mining
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The news: Gold miner Spartan Resources has agreed to sell its Glenburgh and Egerton gold projects in Western Australia to ASX rival Benz Mining, in a deal worth up to $15.6 million.
The numbers: The gross $15.6 million consideration payable to Spartan comprises $1 million in cash, $8.6 million of Benz CHESS depository instruments (CDIs), and up to an additional $6 million in contingent payments.
After completion of the deal, Spartan will become a 15% shareholder in Benz and will be entitled to nominate a director the the Benz board. Spartan is also expected to incur a $17 million non-cash accounting impairment expense against the carrying value of Glenburgh and Egerton.
Spartan shares were down 0.98% to $1.52 in early trading on the ASX but over the last 12 months has rocketed 197.06%.
The context: The miner said it will also provide technical support and assistance to Benz, including lending insights gained at its wholly-owned flagship Dalgaranga gold project in WA's Murchison region.
What they said: "The Glenburgh and Egerton projects have undoubtedly suffered from a lack of attention within the Spartan Group in recent years as a result of the incredible success we have enjoyed at Dalgaranga," said Spartan's interim executive chair Simon Lawson.
"As a result, they are considered non-core within our portfolio given our focus on continuing to rapidly add high-grade ounces and advancing Dalgaranga towards a production re-start decision.
"We are therefore pleased to have reached agreement with a funded and well-backed explorer in Benz Mining to give these assets a reinvigorated life."
The source: ASX announcement
