Africa-Press – Tanzania. PETRA Diamonds has entered into an agreement to sell half of its stake in Mwadui’s Williamson Diamonds to a local firm—Caspian Limited—at 15 million US dollars (35bn/-).
The agreement, if sailed through, will turn the ownership table of the mine in Shinyanga and the government will become the majority shareholder, holding 37 per cent while Caspian and Petra will own 31.5 per cent stake each.
The Treasury Registrar Mgonya Benedicto told the ‘Daily News’ yesterday that the government is aware of the agreement and is working on the proposal before issuing its final go-ahead.
“I have just received the letter this [yesterday] noon. We are working on it to determine a number of issues before coming out with a relevant answer…“We need time since the issue involves several sectors and all have to be consulted,” Mr Benedicto said.
Since 2009, Petra has been the main shareholder of the mine controlling 75 per cent stake and the government 25 per cent. This Monday, the Framework Agreement between the government and Petra increased the former stake to 37 per cent for the one of oldest open pit diamond mines in the world.
According to a statement issued yesterday by Petra, Caspian’s purchase will be funded through the settlement of 11.1 million US dollars of past technical services payments owed by the mine– including services rendered during the recent restart of operations following the care and maintenance period, with the remaining amount being funded by Caspian rendering 3.9 million US dollars of technical services to Williamson in order to ramp-up operations at the mine.
“The transactions in the MoU are subject to Petra and Caspian agreeing definitive transaction agreements, including a share purchase agreement and a shareholders’ agreement, with the parties seeking to agree those transaction agreements in early 2022,” the statement said.
Caspian Chairman Rostam Azizi said the firm is a wholly Tanzanian-owned company and the largest mining contractor with over 30 years mining related experience.
“We have been the contractor of choice to most mines in Tanzania and have maintained long and successful relationships with companies such as Petra, De Beers, Barrick and AngloGold Ashanti.
“We have been contracting at the Williamson Mine, the largest kimberlite diamond mine in the world by surface area for close to 20 years and as such we are particularly pleased to enter into this next phase of our involvement at the mine as co-owners,” Mr Azizi said.
The acquisition, however, is subject to the parties obtaining all necessary governmental, regulatory and lender approvals, including approvals from the Tanzanian Mining Commission, the Tanzanian Fair Competition Commission and The Bank of Tanzania, and a binding ruling from the Tanzania Revenue Authority on the tax treatment of the transaction.
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