Shanghai Construction To Acquire 60% Stake In Eritrean Mining Co.
Tuesday 2011-12-27 10:14 Publisher: CapitalVue
December 27 -- Shanghai Construction Group (600170) approved a plan by its wholly-controlled subsidiary, SEFCO Group, to acquire a 60 percent stake in Eritrean gold mining company, Zara Mining Share, for $80 million, reports Shanghai Securities News, citing a company filing.
SEFCO Group may make further cash payments to acquire additional mining rights from Zara Mining Share.
The target company has exploration and mining rights to an area covering 147 kilometers. Its mining rights to the Koka Gold Deposit in northern Eritrea is valid for a period of 18 years.
ENAMCO, which has a 40 percent stake in Zara Mining Share, has given its approval to the transaction.
SEFCO Group will soon engage a third party to investigate the assets, liabilities and financial status of the target company.
According to Shanghai Construction, should the acquisition succeed, it will obtain stable investment returns and about one billion yuan worth of mine construction contracts, expanding the scale of its business in Eritea.
Shares of Shanghai Construction Group rose 5.27 percent to trade at 8.79 yuan per share at 10:10 today.
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Received on Mon Dec 26 2011 - 23:11:20 EST