15/01/2020 - 11:46

Resolute sells Ravenswood goldmine

15/01/2020 - 11:46

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Perth-based Resolute Mining has finalised the sale of its Ravenswood gold project in Queensland to a private equity and mining consortium for up to $300 million.

Resolute sells Ravenswood goldmine
John Welborn says the deal is value accretive and has strong strategic merit for the company..

Perth-based Resolute Mining has finalised the sale of its Ravenswood gold project in Queensland to a private equity and mining consortium for up to $300 million.

The company has signed a deal with private equity manager EMR Capital and Singapore-based mining company Golden Energy and Resources.

Resolute will receive proceeds of up to $300 million in cash, comprising an upfront payment of $100 million and up to $200 million in potential payments, contingent on factors including future gold production and gold prices.

Potential payments of $150 million are linked to the investment outcomes of Ravenswood for the EMR Fund.

Resolute said there would be no immediate changes to the Ravenswood goldmine employment or contract relationships, and the current mine and development plans would continue.

Completion of the transaction is targeted for March 31.

Resolute managing director John Welborn said the company would focus predominantly on its African gold projects.

“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,” Mr Welborn said.

The company has three projects in West Africa, including the recently acquired Mako gold mine in Senegal, of which Resolute holds a 90 per cent stake.

Resolute also has an 80 per cent interest in the Syama mine in Mali and wholly owns the Bibiani project in Ghana.

The company said early last month it would undertake a strategic review of the Bibiani mine, appointing Cutfield Freeman & Company and Treadstone Resource Partners as advisors.

Mr Welborn said the sale of the Ravenswood project was value accretive and had strong strategic merit for Resolute.

“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,” he said.

Resolute acquired the Ravenswood gold mine in 2004 after entering an agreement with Xstrata Queensland to purchase the mine’s owner, Carpentaria Gold, for $US45 million.

Mr Welborn said the Ravenswood project had delivered strong results for the company, having produced more than 40 million tonnes of ore and nearly 2 million ounces of gold over 15 years.

Shares in the company were up 1.45 per cent at 2:20pm AEDT to trade at $1.19 per share.

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