en.Wedoany.com Reported - Sarama Resources has completed the sale of its majority stake in the Laverton gold project in Western Australia to Riedel Resources, receiving consideration of A$3.2 million in cash and shares. The company is listed on the TSX Venture Exchange (TSX-V) and the Australian Securities Exchange (ASX).
Under the transaction arrangement, Sarama will initially hold a 32% interest in Riedel upon completion, increasing to approximately 44% upon achieving specific performance milestones. Sarama's interest in Riedel will be held through a wholly owned subsidiary.
As part of Sarama's equity and capital management strategy, the company, through a Share Sale Agreement (SSA), manages its arbitration claim exposure while retaining exploration potential by selling the Cosmo and Mt Venn projects to Riedel Resources in exchange for an equity portfolio and partial payment of project-related costs.
The transaction gives Sarama a significant stake in Riedel. Riedel has transformed into a well-funded multi-project gold exploration company with three projects in two Tier 1 jurisdictions: Western Australia and Arizona, USA.
Under the SSA, Riedel acquired Sarama's interests in these projects by purchasing 100% of the shares of Yikarri Resources, a wholly owned subsidiary of Sarama. Consideration includes the issuance of 150 million Riedel shares at a deemed price of A$0.025 per share; the issuance of 100 million Riedel performance rights in four tranches, vesting upon achieving specific exploration, mineral resource, and share price milestones; and payment of project-related costs incurred by Sarama, capped at A$300,000. The shares received by Sarama will be held in escrow for 12 months.
Following execution of the SSA, Andrew Dinning has been appointed as a non-executive director of Riedel, and Paul Schmiede has been appointed as CEO of Riedel. Jack Hamilton has been appointed as Special Advisor for Exploration, overseeing exploration activities across the three projects. The company stated it will retain the services of Schmiede and Hamilton as needed to ensure business continuity, while Dinning will continue in his full-time role as Executive Chairman.
"We are very pleased to complete the sale of our Western Australian assets to Riedel while retaining significant exposure to their future success through our shareholding. We believe the combined portfolio has considerable exploration potential and look forward to seeing these assets advance under a focused and well-funded team," said Dinning. "Completing this transaction is a key part of Sarama's strategy to minimize further dilution to the company's claim against the government of Burkina Faso, while ensuring the Laverton project receives the focused attention and funding needed to unlock its full potential," he added.
