Photo by: Bloomberg
JOHANNESBURG (miningweekly.com) – Aim-listed African Consolidated Resources’ (AFCR’s) acquisition of the Dalny mine, from Falcon Gold Zimbabwe (Falgold), has fallen through, as the company was unable to raise funding for the deal.
AFCR had been trying to raise $12-million required as a precondition to acquiring the Zimbabwe-based mine and associated infrastructure.
Following the termination of the agreement, AFCR would be refunded $500 000 of its initial $1-million initial payment to Falgold.
Meanwhile, the company also announced on Tuesday that it had, in principle, secured joint venture (JV) finance that would enable it, along with a local partner, to start mining at the Pickstone-Peerless gold mine, also in Zimbabwe.
In terms of the proposed deal, AFCR would transfer its interest in Pickstone-Peerless, as well as the Gadzema project, to a new company over which AFCR would have management control.
The local partner would contribute $4-million to gain a 50% interest in the new company.
AFCR expected the funding to enable the start of production at Pickstone-Peerless within eight months.
The local partner had also agreed to extend a $2-million loan facility to AFCR.
The Aim-listed company cautioned that, should it not secure any other financing, it would require the formal signing of the loan agreement with the local partner in the “very near term” to enable AFCR to continue as a going concern.
“Raising new investment finance for Zimbabwe has proved extremely difficult and I am very pleased to have secured funding in principle on a JV basis with a view to commencing production at Pickstone-Peerless,” commented AFCR CEO Roy Pitchford.