Friday, July 19, 2024

Canadian Tango Mining acquires Firestone assets

Toronto-listed (TSX) Tango mining has filed interests in lieu of the acquisition of Aim-listed Firestone Diamonds’ multimillion dollar Botswana operations, including the Orapa kimberlite BK11.

Firestone Chief Executive Officer (CEO) Stuart Brown recently announced that the diamond newcomer has announced a conditional takeover bid for Firestone’s net assets, valued at US$10.7 million.

The bid comes in the wake of a US$700 000 loss incurred by Firestone due to lower local to foreign exchange conversion rates for the financial year ended June 30, 2014.

Brown said: “Firestone Diamonds is pleased to announce that it entered into a conditional agreement for the disposal of its Botswana operations to Tango Mining for a total consideration of US$8.0 million in cash. Firestone would use the Botswana companies net asset disposal proceeds to provide general working capital as it continues with the construction and development of its flagship asset Liqhobong mine, in Lesotho, where production will commence during Q4:2016.”

Firestone, an international diamond development company with operations focused on Lesotho, is currently involved in the Liqhobong mine development project. Lesotho is one of Africa’s emerging diamond producers. Apart from Firestone’s Liqhobong mine, the country also hosts Gem Diamonds’ Letseng mine, Namakwa Diamonds’ Kao mine and the Mothae development project.

Adter the transaction, Tango will acquire Firestone’s wholly-owned subsidiary Firestone Diamonds in Botswana, as well as its 90 percent interest in Monak Ventures. Tango will immediately pay US$350, 000 in cash, while escrowing US$300, 000 as a deposit by no later than September 30, 2015.

“The remainder would be received upon completion of the deal. Completion of the Agreement remained subject to Tango raising the balance of the consideration, of US$7.35 million; depending on the Botswana Competition Authority (BCA) and Botswana Ministerial approvals. Furthermore, the transfer of the controlling interest in Monak, would be formalized after Tango receives the requisite approvals from the TSX in respect of the disposal.”

Tango had also agreed to pay into escrow a deposit by no later than September 30, 2015 and the remainder on completion as the on-going cost of BK11’s care-and-maintenance programme from the date of the agreement up to a maximum of US$40 000 a month. Until October 2014, Tango had been solely devoted to gold exploration in Nicaragua before a “transformational” deal in Q4: 2014 resulted in the company acquiring African Star Minerals. Tango holds a 100 percent interest in the Oena diamond project, in South Africa’s Northern Cape, where bulk sampling operations started in February 2015. It also holds four toll treatment contracts in respect of four producing collieries located within the Ogies and Highveld coalfields, in Mpumalanga, and the Kliprivier coalfield, in KwaZulu-Natal (KZN).

The Canadian Tango Mining Limited’s vision is to become a diversified junior mining company with interests in precious and base metals, coal and diamond mining projects. Tango acquired African Star Minerals Group’s (ASM) operations in South Africa late in 2014, has four thermal coal, metallurgical and processing plants and engineering contracts that process 6.5 million tonnes per annum: 19.5 million tonnes contracted over next three years. Its clientele include Total (SA) and Glencore plc. The Group’s four projects are located within the Ogies and Highveld coalfields, Mpumalanga Province and Kliprivier coalfield, KwaZulu-Natal Province. The Company also holds an interest in Oena, a past producing alluvial diamond property, Northern Cape Province, South Africa and a 100 percent interest in the 2,088.8 hectare El Santo Project, Nicaragua.


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