Tango Mining Ltd. plans to sell its coal assets in South Africa and rebrand as Southstone Minerals Ltd. as the company shifts its focus to the Oena diamond mine in the country.

Tango said July 30 that it agreed to sell to company director Kevin Gallagher its 74% interest in each of Kwena Mining Projects (Pty) Ltd., Kwena Mining and Metallurgical Services (Pty) Ltd. and Kwena Springlake Projects (Pty) Ltd., which have a combined value of C$2.3 million based on an informal valuation in March 2017.

In exchange, Gallagher will return for cancellation 39,988,160 Tango shares at 5 cents apiece for C$2.0 million in total. The target's outstanding debt of C$723,021 to Tango will also be waived.

Upon closing, Gallagher will not hold any Tango securities other than stock options. Tango expects its total assets to be slashed to C$1.6 million from C$4.4 million and current liabilities to be cut to C$1.6 million from C$3.7 million. Its shareholdings are also expected to be reduced to 192,613,979 shares from 232,602,139 shares.

The deal is subject to the approval of minority shareholders, who will meet Sept. 13 during a special meeting to vote on the sale. Disinterested directors approved the transaction and deemed it as fair.

In March, the company terminated its agreement with Metswedi Mining Pty. Ltd. to acquire a 75% stake in the Middlepits diamond project in Botswana, and amended a deal with West Mining Ltd. to increase its ownership in the Mano River diamond project in Liberia to 90%.