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
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.