Bushveld Minerals' wholly owned subsidiary Greenhills Resources has agreed terms to acquire a significant interest in Namibia's Uis tin project.
Under the agreement, Greenhills Resources will acquire 49% interest in Dawnmin Africa Investments, which holds 85% interest in the Uis project.
The deal is subject to due diligence from a Namibian shareholders consortium.
Bushveld Minerals CEO Fortune Mojapelo said: “The completion of the potential acquisition would see Bushveld Minerals acquire a substantial interest in one of the largest undeveloped opencast hard rock tin deposits in the world, positioning Greenhills Resources as one of the most significant tin platforms on AIM.”
Erongo Tin holds 50.5% majority of the issued share capital of Dawnmin not held by Namibian shareholders selling. The consortium of sellers includes Namuis (Pty) Ltd, Havana Investments and Sweltering Desert Investments.
The Uis tin project is regarded as one of the largest undeveloped opencast hard rock tin deposits globally. Located in the Erongo region of Namibia, it consists of three mining licences, ML 134, ML 129 (B1 and C1) and ML 133.
Earlier mining confirmed significant tin resource on all the three licences among which the ML 134 resource is estimated to contain at 70.3Mt at 0.14% Sn for a total potential resource of over 90kt of contained tin.
Guinea Fowl Investments Twenty Seven currently holds this project. Dawnmin Africa Investments owns 85% interest in Guinea Fowl Investments.
The remaining ownership lies with Small Miners of Uis (SMU), a company owned by the Government of Namibia.
Under the agreement, Greenhills Resources will conduct due diligence on the Uis tin project. If successful, it plans to acquire the initial 49% shareholding against a consideration equal to 4.1 million ordinary shares in Bushveld Minerals.
The agreement gives the opportunity to Greenhills Resources to conduct due diligence on the project to 31 March 2017.
The acquisition is also subject to the signing of definitive agreements, share purchase agreement with all subsequent regulatory approvals.
Bushveld Minerals is a diversified mineral development company with projects in South Africa and Madagascar. It established Greenhills Resources to develop a pan-African portfolio of tin assets.