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LISTED explorer Meridian Minerals (ASX: MII) has entered into a heads of agreement to sell its Lennard Shelf Project for $78 Million to cornerstone Chinese investor Northwest.
Northwest will invest $7m to progress the project, located In the Kimberley region of Western Australia while the transaction progresses and approvals are finalised.
Northwest (via its subsidiary), Northwest Nonferrous Mining Australia Pty Ltd, is Meridian’s largest shareholder with a 41.34 per cent stake.
Meridian managing director Jeremy Read (pictured), says it presents a major capturing of value and will provide Meridian’s shareholders with a significant return on the $27.3 million
investment it has made in the project since it was acquired in November 2009.
“The proposed sale of the Lennard Shelf Project to Northwest will allow Meridian to capture significant value for the Lennard Shelf Project and place the company in a strong position to follow through on our longer term strategy of building a mid-tier mining company,” he says.
“With a likely cash balance of approximately A$68M post the sale of the Lennard Shelf Project, Meridian will be in a position to look at larger, longer term projects and potentially, projects already in production, which we have not been in a position to do before.”
Meridian was advised by Hynes Lawyers.
MII shares jumped 22 per cent to 13c today following the announcement.
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