Cape Lambert Iron Ore (CLIO)
Cape Lambert proposes to make a 30% investment in major African Hematite Iron Ore Project in US$45M deal
Highlights:
• Cape Lambert signs a binding agreement which is subject to the satisfaction of certain conditions as outlined below to make a 30% investment in Marampa Iron Ore Limited, owner of the exploration stage Marampa iron ore project inSierra Leone,
• Cape Lambertwill issue 44 million shares to make the 30% investment (which represents approximately 10% of its current total issued capital) and will sole fund the first US$25 million toward a definitive feasibility study,
• Exclusive option to acquire the outstanding shares in Marampa Iron Ore Limited, that if exercised will deliver the Company control of the Marampa iron ore project,
• Due diligence metallurgical test work completed by Cape Lambert indicates a premium hematite concentrate grading approximately 67% Fe and 1.9% SiO2 can be produced using simple gravity separation,
• Completion of the investment is subject to the successful conclusion of due diligence by Cape Lambert and the receipt of all necessary regulatory approvals, and is expected to occur on or before 30 September 2008, and
• Cape Lambert shares issued in consideration for the investment will not dilute existing shareholders in respect of the capital reduction and dividend payment proposed to be paid to shareholders in early October 2008.
Australian iron ore company Cape Lambert Iron Ore Limited (CLIO) signed a conditional agreement on 1 September 2008 to make a 30% investment in Marampa Iron Ore Limited, a Bermuda registered, wholly owned subsidiary of African Minerals Limited and owner of the Marampa iron ore project located in Sierra Leone in a cash/scrip deal valued at more than US$45M.
Executive Chairman Tony Sage commented:
“an initial 30% investment and the option to increase to 100% interest in the Marampa Project, which is adjacent to existing rail infrastructure that is connected to a deep water port, has simple metallurgy, potentially a premium product and excellent exploration upside the Board believes will deliver to Cape Lambert shareholders exposure to a quality iron ore asset”.
He further added “the investment in Marampa signifies the first significant corporate transaction since Cape Lambert finalised the AUD$400M sale of its namesake project to a subsidiary of Chinese company, China Metallurgical Group Corporation”.