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Ariana Resources secures landmark deal for Turkish gold assets (AAU)
Ariana Resources (LSE:AAU) re-captured its multi-year highs on Wednesday, rising by more than 7% to 4.2p on news of a potential transformational deal for its Turkish assets.
Ariana revealed that construction conglomerate Özaltin Holding has formally committed to purchasing 53% of its Salinbas gold project.
The firm will also take a 53% stake in Ariana’s 50:50 Red Rabbit joint venture with Proccea Construction, which holds the producing Kizilitepe gold project and the Tavsan asset in western Turkey.
Ariana, which currently has a £44.3 million market cap, will receive $50 million for the Red Rabbit stake, to be shared with Proccea.
Meanwhile, Özaltin has committed to injecting $8 million of equity into Salinbas with a view to ultimately acquiring the asset in full.
Özaltin’s recent large scale construction projects include hydroelectric dams with installed annual power production capacity of 5.5 billion KWh.
It is also a 22-year consortium partner in the Gebze-Orhangazi-İzmir Motorway Build-Operate-Transfer Project.
Ariana’s managing director Dr. Kerim Sener said he was “very pleased” with the construction firm’s decision, which followed months of due diligence.
"Ariana, Özaltin and Proccea are now working through the necessary steps, including seeking Ministerial approval, in order to complete the transaction.
“This will lay the foundations for the completion of our transaction, substantially as proposed in the MoU, but including various minor modifications to ensure robust legal documentation, structural changes in the type of company and practical outcomes in the context of Turkish Law. In addition, at the earliest possible opportunity, Ariana will make the necessary arrangements to seek shareholder approval for the transaction via a General Meeting.”
Sener added that the transaction would “crystallise significant value” for Ariana’s shareholders.
In particular, it provides much-needed financial backing to Salinbas, which is now approaching the “decision-to-mine” stage.
“Accordingly, we fully expect shareholders to support the transaction, definitive agreements for which are expected to be concluded by the end of August 2020,” added Sener.
Author: Daniel Flynn
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