Aziana Limited to sell Manantenina Bauxite Project to Indian buyer

Aziana Limited has signed a conditional agreement to sell its Manantenina Bauxite Project in Madagascar for a total consideration of US$2 million (A$2.56 million) to India’s Thankys Exports Pvt. Ltd.

The non-binding agreement includes a royalty of US$0.50 per tonne of bauxite mined.

Manantenina currently has a resource of 10.09 million tonnes. Further high quality bauxite has been identified over more than 80 square kilometres of the project but is as yet unquantified.

Thankys exports gibbsiferous bauxite from their existing mines in India and has been involved in the exploration for and development of bauxite deposits since 1980.

Sale agreement

Under the proposed agreement, the buyer has agreed to make a minimum royalty payment of US$200,000 per annum for the first five years regardless of mining taking place.

If mining does occur, the payments will be a minimum of US$200,000 or according to the royalty obligation if more than 400,000 tonnes of bauxite is mined.

This is subject to a number of conditions:

- Completion of a second phase of due diligence by Thankys on the business, assets and operations, to the satisfaction of Thankys which must be completed prior to 30 June 2015;
- Aziana’s subsidiary Esama Minerals Sarl being issued with a mining license for the leases contemplated under this agreement;
- Thankys paying all costs associated with the preparation of a mining application;
- Aziana’s subsidiary, Esama Minerals Sarl entering into a service agreement with Thankys for a minimum term of 12 months, on terms and conditions acceptable to both parties;
- If required by ASX, the shareholders of Aziana Limited approving the transactions contemplated by this agreement in a general meeting, in accordance with the ASX Listing Rules and the Corporations Act; and
- The parties executing a formal share sale agreement.
Settlement will occur 5 business days after all conditions precedent have been met or waived by mutual consent.