Norin Mining Kingco, a wholly owned subsidiary of Norin Mining, has agreed to acquire DRC cobalt miner Chemaf Resources Limited (CRL).
This move comes as a strategic step for the cobalt miner, which has faced financial difficulties, impacting its operations in the DRC.
The share purchase agreement signed with CRL’s parent company, Chemaf Group, will result in Norin Mining Kingco acquiring all shares in CRL.
Notwithstanding this deal, Chemaf S.A. (Chemaf) will remain a subsidiary of CRL.
Norin Mining Kingco has also agreed to acquire the direct shareholding of Chemaf founder and chairman Shiraz Virji.
The DRC Government has also approved the sale, which will indirectly change the control of Chemaf.
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By GlobalData
The transaction is still subject to customary conditions. These include approvals from Chemaf’s partner at Mutoshi, Gecamines and Chinese regulatory bodies.
Last year, Chemaf had put itself up for sale due to financial constraints that hindered progress on its two Congo projects – the Etoile mine expansion and the Mutoshi greenfield mine development.
Virji said: “I am pleased to have found a new owner that can invest in completing the development of Etoile Phase 2 and Mutoshi, which will be to the benefit of the DRC for decades to come.”
Proceeds from the sale will be used by Chemaf to meet creditor obligations, settle debts, and introduce a new owner capable of financially and technically supporting the expansion of the Etoile mine and the development of the Mutoshi project.
Chemaf Group of Companies and Shiraz Virji advisor Jeremy Meynert said: “Following a highly competitive international auction process, we are pleased to have signed a transaction with Norin Mining, which will allow CRL and Chemaf to meet their obligations to existing lenders and creditors.
“Importantly, Chemaf has found a new owner, Norin Mining, which has the experience and commitment to build on Shiraz Virji’s legacy and deliver the Etoile Phase 2 and Mutoshi projects.”
