The deal announced in July under which China’s Yunnan Tin Group is to acquire up to 60% of Metals X’s Tasmanian tin assets as part of a joint venture between the two companies is on hold pending approval from Australia’s Foreign Investment Review Board (FIRB). The deal was originally due to have been completed by end-October, subject to shareholder and official approvals.
In a statement last week Metals X reported that an extension of up to three month to the deal had been agreed by the prospective partners. “Metals X and YTG have agreed to an extension of the acquisition agreement to 31 January 2010 to enable sufficient time to obtain FIRB approval. It is anticipated that approval may be obtained earlier and the JV will be completed shortly thereafter. YTG have reaffirmed their commitment to proceed with the addition of a break fee of $2.5M should the agreement fail for any reason other than Governmental approvals.” The deal also has to be approved by the Chinese government
YTG is to pay A$50 million for a 50% stake in the joint venture, with an option to take a further 10% at a price to depend on operating performance. The Tasmanian tin operations produced 1,404 tonnes on tin-in-concentrate in the September quarter, a slight improvement on the 1,361 tonnes produced in the previous quarter. This was attributed to higher feed grades and improved recovery in the concentrator. The operations produced a positive cashflow of A$3.83 million in the period.
