Shares of Asiament Resources (LON: ARS) rallied before falling Wednesday after the company announced it has secured a strategic partner for the BKM Copper Project.
The company has entered into a Heads of Agreement (HoA) with PT Delta Dunia Makmur Tbk (DOID), an Indonesian public company and one of the largest mining services companies in Indonesia.
Delta Dunia will earn a 51% interest in Asiamet's subsidiary, Indokal Limited, by contributing $50 million towards the BKM mine development via cash payments and in-kind expenditure.
Once the binding agreement has been executed, $10 million will be paid in cash to complete value engineering works, $10 million will be paid in cash to undertake Front End Engineering Design works, $20 million will be paid either in cash or in-kind for civil and mine engineering-construction works, and $10 million will go towards long lead time capital items.
“The deal is expected to create significant value for all company stakeholders,” said Asiamet.
Tony Manini, Executive Chairman of Asiamet, said: “The Asiamet Board endorses and fully supports the proposed transaction which establishes a clear path for the financing and development of the BKM copper project and the broader KSK Contract of Work.Â
“DOID is a major player in the contract mining services business across Indonesia and its recent acquisition of a large contract mining businesses in Australia clearly indicates its plans to grow. Through the establishment of this strategic partnership with Asiamet, DOID intends to build a platform for expansion in the future facing base and precious metals sector.”
After initially surging and touching a high of 3.3p, Asiamet shares are now down 6.5% at 2.5p.
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