Resolute Sells Ravenswood Gold Mine for AU$300 Million

Resolute Mining has sold its Ravenswood gold mine to EMR Capital and Gold Energy and Resources for proceeds of up to AU$300 million in cash. 

Resolute Mining (ASX:RSG,LSE:RSG,OTC Pink:RMGGF) has sold its Ravenswood gold mine to EMR Capital and Gold Energy and Resources (SGX:AUE) for proceeds of up to AU$300 million in cash.

Highlights are as follows:

  • Resolute has signed definitive agreements for the sale of the Ravenswood gold mine in Queensland to a
    consortium comprising a fund managed by private equity manager EMR Capital and leading energy and mining
    company Golden Energy and Resources.
  • Sale proceeds of up to AU$300 million in cash to be received by Resolute comprising AU$100 million of upfront
    value and up to AU$200 million in potential payments contingent on future gold prices, future gold production from
    the Ravenswood Gold Mine, and the investment outcomes from the Ravenswood Gold Mine for EMR Capital.
  • EMR Capital, led by executive chairman Owen Hegarty and CEO Jason Chang, is a globally
    leading specialist resources focused private equity group with outstanding credentials and a track record of
    achievement as a developer and operator of Australian-based mining assets.
  • GEAR is a leading energy and resources company in Asia Pacific that is listed on the Singapore Stock Exchange
    with producing coal assets in Indonesia and strategic stake investments in two ASX-listed mining companies.
  • EMR Capital and GEAR are committed to progressing the Ravenswood expansion project.
  • No immediate changes to Ravenswood gold mine employment or contract relationships, with current mine plan
    and development plans to continue.
  • The divestment provides strategic clarity and is consistent with Resolute’s ambition of being a low-cost multimine African-focused gold producer.
  • Transaction terms maximise financial returns for Resolute from the Ravenswood Gold Mine with no future capital
    or funding requirements.
  • Resolute will receive cash proceeds of up to AU$300 million comprising:
    • AU$100 million of upfront value consisting of AU$50 million of cash and AU$50 million in promissory notes;
    • up to AU$50 million linked to the average gold price over a four-year period (gold price contingent payment); and
    • up to AU$150 million linked to the investment outcomes of Ravenswood for the EMR Fund (upside sharing
    payment).

John Welborn, managing director & CEO, commented:

The sale of our Ravenswood Gold Mine on the terms announced today provides the opportunity for exceptional value for Resolute shareholders. We have strengthened our balance sheet with a combination of immediate cash and the potential for future upside as well as removing the requirement of a large near-term capital investment. The divestment has strong strategic merit for Resolute. We have delivered on our objective of ensuring a new long-life future for Ravenswood under a world-class operator and can now focus our attention and energy on our African portfolio and the abundant opportunities our experience provides for further growth and value creation.

Click here to read the whole Resolute Mining (ASX:RSG,LSE:RSG,OTC Pink:RMGGF) press release.

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