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Acquisition Update

RNS Number : 1126J
African Potash Ltd
02 August 2012
 



African Potash Limited / Index: AIM / Epic: AFPO / Sector: Mining

2 August 2012

African Potash Limited ('African Potash' or 'the Company')

Acquisition Update

 

African Potash Limited, the AIM listed African exploration company, provides an update to its announcement of 3 February 2012 regarding the conditional share purchase agreement ('SPA') it entered into to acquire the entire issued share capital of Patagonia Capital Limited ('Patagonia'), a Mauritian company which holds a 70% interest in La Societe des Potasses et des Mines S.A. ('SPM'), a company incorporated in the Republic of Congo for the purpose of mineral exploration ('the Proposed Acquisition').

 

The Proposed Acquisition will constitute a reverse takeover for the purposes of the AIM Rules and accordingly, trading in the Company's shares was temporarily suspended, effective 17:30 on 3 February 2012, until the earlier of (a) the publication of a re-admission document by the Company in respect of the Proposed Acquisition (the 'Admission Document'); and (b) the elapse of six months.

 

The Proposed Acquisition is conditional, inter alia, on shareholder approval being granted and also a permis de recherches (the 'Permis de Recherches') being granted by the Government of the Republic of Congo in respect of the Lake Dinga area of the Republic of Congo, on which in July 2011, SPM received an authorisation to conduct prospecting for potash (and associated minerals).

 

SPM has not been granted the Permis de Recherches at the date of this announcement, despite preliminary approval and recommendation by the Minister of Mines, and therefore the Company has not been able to finalise the Admission Document.  The principal reasons for the delay in the granting of the Permis de Recherches are factors outside the control of management and Patagonia, including the well publicised munitions explosion in Brazzaville, the capital of the Republic of Congo on 2 March 2012, and the national Parliamentary elections which took place on 15 July 2012.

 

Trading in the Company's shares will therefore remain suspended until such time that the Admission Document is published or the Board of Directors decides to terminate the SPA.

 

African Potash Chairman and CEO, Edward Marlow, said, "The delay in the issuance of the Permis de Recherches to SPM has been caused by matters beyond the Company's control; namely the tragic munitions explosion in Brazzaville and more recently by Parliamentary elections.  Understandably, day to day Government business in the Republic of Congo has been disrupted by these factors.

 

"Throughout the period of delay, African Potash has continued to support and monitor SPM and has in addition discovered considerable data available to support and encourage a future and highly prospective exploration programme.  The Board has been reassured by the Minister of Mines of the Republic of Congo that the Permis de Recherches will be issued at the next Council of Ministers, as required by the laws of the Republic of Congo. The Directors of African Potash remain confident in the value of the Lac Dinga Permit to shareholders and believe that the conditions precedent contained within the SPA will be met shortly."

 

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For further information visit www.africanpotash.com or contact the following:

Ed Marlow

African Potash Limited

+44 (0) 20 7408 9200      

Jonathan Wright

Seymour Pierce Limited

+44 (0) 20 7107 8000      

David Foreman

Seymour Pierce Limited

+44 (0) 20 7107 8000      

Richard Greenfield

GMP Securities Europe LLP

+44 (0) 20 7647 2836      

Susie Geliher

St Brides Media and Finance Ltd

+44 (0) 20 7236 1177      

 

 

 

 

 

 

 

 

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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