CZR Resources is a step closer to completing its $75 million sale of the Robe Mesa iron ore project in Western Australia, having received the green light from the Foreign Investment Review Board (FIRB).
The FIRB confirmation means the Australian Treasurer has no objections to the Robe River Iron Associates joint venture (RRJV) transaction under the Foreign Acquisitions and Takeovers Act 1975, satisfying one of the key conditions outlined in the sale agreement.
“CZR is pleased to advise that RRJV has received confirmation from the FIRB that the Treasurer of the Commonwealth of Australia has no objections to the RRJV transaction,” CZR said.
The company had previously announced shareholder approval of the Robe Mesa transaction on May 29.
Remaining conditions include ministerial consent under the WA Mining Act 1978, third-party consents and foreign regulatory approvals related to competition, anti-trust and national interest.
Led by Rio Tinto, the RRJV also includes Mitsui & Co and Nippon Steel. Their proposal was deemed “more favourable to CZR shareholders than the transaction contemplated by the Fenix takeover offer”.
“The consideration of $75 million represents a significant premium to the all-scrip Fenix transaction,” CZR said in April.
The offer also includes a working capital loan facility of $3.85 million for CZR subsidiary Zanthus Resources and a release deed in which Mark Creasy and ZanF waive joint venture rights to enable the transaction.
CZR expects post-tax proceeds of approximately $68 million, which the company said will place it in a strong position to fund its remaining assets.
“The cash consideration also reduces CZR’s exposure to capital and commodity markets in a highly volatile period, while allowing it to assess new business opportunities and/or consider a return of capital to shareholders,” CZR said.
CZR will retain key assets, including its Ashburton link and port project, the Croydon gold project, and the Buddadoo magnetite target – all of which are in WA.