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Petropavlovsk Plc (POG)

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Friday 18 February, 2011

Petropavlovsk Plc

Heads of Agreement

RNS Number : 4868B
Petropavlovsk PLC
18 February 2011
 



 

Heads of Agreement

 

 

18 February 2011

 

 

Further to the announcement released on the Australian Securities Exchange by the Australian resources company, Meridian Minerals Limited ("Meridian") on 18 February 2011, Petropavlovsk PLC ("the Company" or "the Group") confirms that it has entered into a non-binding Heads of Agreement ("HOA") with Meridian relating to the potential sale by the Group of a 75% interest in the Russian gold company, ZAO ZRK Omchak ("Omchak") (the "Sale").   It should be noted that these Omchak assets are not considered to be core for the Group.

 

The alluvial assets, currently owned by Omchak and its subsidiaries, are not intended to form part of the Sale and it is anticipated that these assets will be transferred to the Group prior to the Sale.  It is the intention of the parties that, subject to satisfaction of all of the conditions specified in the HOA, the definitive transaction documents for the Sale, including a sale and purchase agreement and a shareholders' agreement, will be entered into on or before 11 May 2011. 

 

Under the terms of the HOA, the parties agreed to an exclusivity period ending on 11 May 2011, during which Meridian intends to conduct due diligence on the assets that may be acquired. Entry into the definitive transaction documents would be subject to a number of conditions, including:

 

(a)     the minority shareholder, which holds the other 10% interest in Omchak, selling its entire interest in Omchak to either Meridian or the Company;

(b)     the alluvial assets currently owned by Omchak and its subsidiaries being transferred to the Company; and

(c)     Meridian obtaining finance to proceed with the proposed acquisition.

in each case, before 11 May 2011.

In addition, the standard corporate and regulatory approvals would need to be obtained before any final transaction documentation is entered into, which may include obtaining the consent of the Federal Antimonopoly Service of the Russian Federation.

 

The anticipated consideration for the Sale is US$40 million, which is intended to be payable by Meridian to the Group up to 60 days after the date of entry into the definitive transaction documents for the Sale.

 

 

Enquiries:

 

 

Petropavlovsk PLC

+44 (0) 20 7201 8900 

Alya Samokhvalova 

Rachel Tuft

 

 

Merlin

David Simonson

Fiona Crosswell


+44 (0) 20 7726 8400 

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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