Lindian Resources Ltd. said Oct. 6 that it has executed a binding deal to acquire the Uyowa and Kahama gold projects in Tanzania.
The group will buy Tangold Pty. Ltd., which owns the projects through its Tanzanian subsidiary, Hapa Gold Ltd. Lindian will issue 750,000,000 of its fully paid shares upon deal completion.
Lindian will also issue 250,000,000 class A performance shares, converting on the company's announcement of a JORC-compliant inferred mineral resource or the greater of 200,000 ounces of gold at 2 g/t of gold, with a cutoff grade of 0.5 g/t of gold. Conditional upon the conversion of the class A shares, the company will issue 250,000,000 class B performance shares when an independent third party expert produces a positive pre-feasibility study on the projects.
Lindian will also grant a 2% net smelter return royalty to Kabunga Holdings Pty Ltd., half of which the company can buy back on terms to be agreed.
The deal is subject to completion of due diligence by Lindian as well as approvals of Lindian shareholders. The conditions must be satisfied on or before Dec. 31.
In connection with the acquisition, Lindian will undertake a placement of 200,000,000 fully paid ordinary shares at 0.15 Australian cent per share, raising A$300,000 to fund due diligence on the Tanzanian projects and for working capital. The company will also undertake an entitlement issue to fund further exploration.