East Africa Metals has received confirmation from Shandong Tyan Home that it has completed the subscription agreement to acquire 20 million units in the company.

This follows the completion of the sub legal, financial and technical due diligence by Shandong.

TSX-listed East Africa Metals said that Shandong will acquire the units at a price of $0.26 per unit for the company’s gross proceeds of $5.2 million.Each unit comprises of one common share and one-half share purchase warrant with an exercise price of $0.45.

Shandong Tyan Home has also agreed to provide or identify a partner or lender to provide a $10 million line of credit to support the development of the Terakimti Oxide gold project.

East Africa Metals said that once the subscription financing is complete, the funds will be used for on-going exploration and the development of East Africa’s Adyabo and Harvest projects located in the Tigray region of the Federal Republic of Ethiopia and general working capital.

East Africa Metals’ principal assets and interests include both the 70% owned Harvest polymetallic VMS exploration project, which hosts the Terakimti deposit and which covers approximately 86 square kilometres in the Tigray region of Ethiopia, and the Adyabo project, hosting the Mato Bula trend Adyabo Resource, covering 225 square kilometres immediately west of the Harvest Project.

East Africa owns 100% of the Adyabo project. The company now has mineral resources defined at both projects in Ethiopia and plans to continue to test priority targets.

Shandong is a Chinese public company listed on the Shanghai Stock Exchange, with an integrated business covering real estate, mining, finance and venture capital investment.