Avocet Mining defers sale of Burkino Faso assets
Embattled gold explorer Avocet Mining has been forced to delay the sale of its Burkina Faso assets, including the Inata goldmine, on the request of the buyer, Ghana's Balaji Group.
Avocet had agreed with Balaji on 18 December to dispose of Resolute Mining, its local Burkinabe operator, and all of its assets in the West African nation, along with certain receivables, to Balaji for a total consideration of $5m.
Balaji then entered into discussions with International Royalty Corporation (IRC), a creditor of Resolute, as the operator had come under threat of insolvency, leading the Ghana-based outfit to request the sale's completion be deferred until 25 January in order to reach a settlement with IRC. Balaji, according to its sparsely detailed website, was founded in 2001 with a head office in Accra, operations ranging from diamond and mineral trading to agriculture, group turnover "exceeding 300m US dollars in 2013" and offices in Dubai, Belgium, India Mali, Burkina Faso, Guinea-Conakry, Ivory Coast and Uganda.
Avocet granted Balaji's proposal after the latter paid a $500,000 deposit, which would form part of the total cash consideration payable if the sale was to occur.
The sale of the Burkina Faso assets has been part of a larger restructuring by Avocet, which is in talks with its sole creditor, Manchester Securities Corp, also known as Elliott, over the restructuring of its $28.7m of overdue loans, which are secured, in part, over the shares in Resolute and other assets.
As of 0840 GMT, shares had grown 2.49% to 18.50p.