Atrum Coal amends terms of acquisition of Elan Coal’s hard coking coal properties
Wednesday, December 6th, 2017
- Atrum Coal and the vendors of the Elan coking coal properties have agreed on an amendment to the Sales and Purchase Agreement (SPA) to allow Atrum Coal to acquire the properties directly rather than through Kuro Coal Ltd, subject to certain conditions precedent first being satisfied.
- Under the amendment, Atrum will assume all the rights and obligations of Kuro Coal in the original SPA, including the payments of C$3.65M in Atrum shares at a price of A$0.19 and C$3M cash.
- As previously announced, the Elan properties consist of six (6) areas which are known to hold shallow emplacements of high quality hard coking coal. The Elan South project is adjacent and contiguous with the Riversdale Resources Grassy Mountain project, and is in close proximity to critical infrastructure for development (refer Press release of 2 November 2017 noted below).
Atrum Coal Limited (“Atrum” or the “Company”) (ASX: ATU), is pleased to announce that Atrum’s wholly-owned subsidiaries, Kuro Coal Limited (“Kuro”) and Kuro Coal Canada Inc (“Kuro Coal Canada”), have agreed to new terms with the vendors of the Elan coking coal properties as noted below:
- Atrum will purchase all of the shares in Elan Coal Ltd (“Elan”) (a company incorporated in Canada);
- Kuro will no longer seek to separately list on the ASX, TSX Venture Exchange or an alternative international exchange;
- Kuro and Kuro Coal Canada will assign all the rights and obligations in the original SPA to Atrum, and Atrum will assume the payments being C$3.65M in Atrum shares at a price of A$0.19 and C$3.0M cash; and
- The transaction must be completed by 31 March 2018 unless all parties agree to an extension.
Atrum Managing Director, Max Wang commented: “We are very pleased with this amendment as it will eliminate the significant cost and management complexity of listing Kuro on a stock exchange, and thus is an obvious value increase for the Atrum shareholders.
“The Elan properties consist of six (6) different areas which are known to hold shallow emplacements of high quality hard coking coal. The first project we will target for development will be Elan South, which is adjacent and contiguous with the Riversdale Resources Grassy Mountain project.
“We now will have major premium metallurgical coal projects in two provinces in Canada: the Groundhog/Panorama Anthracite Projects in British Columbia and the Elan Hard Coking Coal Project in Alberta. Atrum is well positioned to benefit from the strong forecast metallurgical coal market.”http://atrumcoal.com