Julien Balkany, the Vice-Chairman of the Board of Directors at Sarmin Bauxite Limited, confirmed that on September 23rd, 2020 that the company has entered into a definitive investment agreement with Lindian Resources of Australia. Sarmin Bauxite holds the “Lelouma” bauxite permit with significant resources, ocated in the Republic of Guinea, West-Africa.
The transaction represents the sale of a majority of the shares of the company Sarmin Bauxite (75% stake) to Lindian Resources.
After the public announcement, Lindian Resources, the Australian Securities Exchange listed company saw its shares closed at 40% higher on that day. Lindian Resources shares surged at some point over 60% during the trading session, indicating the positive momentum and the warm reception by the stock market investors. Lindian Resources is well known for specializing in high-grade bauxite sites across Eastern and Western Africa. Securing the Lelouma permit pushes the company’s goal of expansion further into the global bauxite resource market.
Julien Balkany, Vice-Chairman of the Board of Sarmin Bauxite said: “Sarmin Bauxite is very enthusiastic about this landmark transaction and our new partnership with Lindian Resources that will see the development of the Lelouma mining activities moving forward”.
According to the released terms of the transaction, Lindian will take control of 75% of the existing mining company and Sarmin Bauxite shareholders are set to receive in exchange an allotment of 30.67 million new Lindian shares. These new shares will be issued at the completion of the transaction to Sarmin’s shareholders. Additionally, within twelve months of the completion of the definitive feasibility study, Sarmin Bauxite’s shareholders may sell to India their remaining 25% stake in exchange for a 1% overriding royalty. Until then, Sarmin shall benefit from a full, free carried interest on all mining activities related to the Lelouma Mining Project.
“Sarmin Bauxite is extremely pleased to have reached this win-win agreement with Lindian that perfectly suits all parties’ ambitions. We are very confident that Lindian has the technical and operational capabilities along with the depth of expertise and vision to advance further the Lelouma Project. We are also thrilled to retain direct and indirect exposure to the Lelouma Project through our shareholding into Lindian and our free carried interest that could be converted into a royalty at a later stage.” said Marc Senges, the Chief Executive Officer of Sarmin.
The closing of the transaction that is expected within the upcoming months is subject to customary conditions precedent including mainly the final approval of the Guinean Government, and Lindian shareholders.