AngloGold Ashanti Limited has announced that it, together with its JV partner IAMGOLD Corporation, have completed the sale of their entire interests in SEMOS to Allied Gold Corp.
SEMOS’ principal asset is the Sadiola mine located in the Kayes region of Western Mali.
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Prior to the completion of the Transaction, AGA and IMG each held a 41% interest in SEMOS with the remaining 18% interest held by the Republic of Mali.
Pursuant to the Transaction and immediately prior to Completion, the
Republic of Mali acquired a further 2% interest in SEMOS.
Consequently, upon Completion, AGA and IMG each sold a 40% interest in SEMOS to Allied Gold Corp.
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Immediately prior to the Republic Transaction, a dividend of US$20 million was declared and paid by SEMOS pro rata to its shareholders.
AGA and IMG each received a cash dividend of US$8.2 million and the Republic of Mali received a cash dividend of US$3.6 million.
Upon Completion, AGA and IMG received US$50 million from Allied Gold Corp and the Republic of Mali.
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Within three business days of Completion, AGA and IMG will receive the agreed additional consideration of approximately US$3.6 million based upon the amount by which the cash balance of SEMOS at 30 April 2020 was
greater than an amount agreed pursuant to the Transaction agreement entered into by AGA and IMG with Allied Gold Corp in December 2019.
In terms of the Transaction and the Republic Transaction, AGA and IMG remain entitled to the following deferred consideration:
- US$25 million upon the production of the first 250,000 oz from the Sadiola Sulphides Project
- US$25 million upon the production of a further 250,000 oz from the SSP; and
- US$2.5 million in the event a favourable settlement is achieved by SEMOS in the litigation pending before the Malian courts
The profit from the disposal of AGA’s entire interest in SEMOS will be recognised in AGA’s financial statements for the financial year ending 31 December 2020.
Prior to the Completion, the Republic Transaction and the dividend declaration, AGA’s net carrying value for SEMOS, on an attributable basis, was US$20 million.
The Transaction is not a categorised transaction in terms of the JSE Limited Listings Requirements.
For AGA, the Transaction completes a phase of portfolio rationalisation and optimisation that commenced in 2014. AGA retains a high-quality portfolio of 10 operating mines located in seven countries, together with two principal development projects in Colombia and other greenfields development assets located in the United States and Colombia.
Commenting on the completion of the Transaction, Christine Ramon, interim CEO of AGA said, “Completion of the Transaction is in line with our disciplined capital allocation strategy as we have moved to streamline our portfolio.
“I would like to thank the Republic of Mali, IAMGOLD and the team at the Sadiola Mine for their valued contributions over more than twenty years.
I am pleased we have completed the Transaction with Allied Gold, which has plans to secure the next phase and long-term future of the Sadiola Mine for the further benefit of all of its stakeholders”.