Currently viewing Global edition

Savannah to acquire remaining 25% in Mina do Barroso

Savannah Resources (AIM:SAV) has decided to acquire full control of its Mina do Barroso lithium project in Portugal through an all-share offer worth US$11.9 million.
Savannah to acquire remaining 25% in Mina do Barroso Savannah to acquire remaining 25% in Mina do Barroso Savannah to acquire remaining 25% in Mina do Barroso Savannah to acquire remaining 25% in Mina do Barroso Savannah to acquire remaining 25% in Mina do Barroso

Savannah will soon own 100% of the Mina do Barroso project in Portugal

Staff reporter

Savannah already owns 75% of the project and will buy the remaining quarter from minority shareholders, including Savannah shareholder Slipstream Resources Investments, by issuing 163 million new ordinary shares at US7.3c per. This equates to 15.6% of its enlarged issued share capital.

After the transaction, Slipstream will have a 16% shareholding in Savannah, up from its previous 5.1%.

The parties have agreed to a 12-month lock-in arrangement on the shares and a further nine-month orderly market restriction after the deal closes.

The deal is subject to Savannah entering into a legally binding share purchase agreement with the parties, which itself is subject to shareholder approval at the company's 2019 annual general meeting.

Savannah said the 100% ownership would "provide greater exposure" for its shareholders to the project, as well as provide "valuable optionality" as Mina do Barroso is developed and commercialised.

CEO David Archer said Savannah saw great economic and strategic value in the project and was pleased to increase its stake to give it complete control.

He said the company welcomed the simplification, clarity and valuable optionality the deal provided at it progressed its negotiations regarding lithium and co-product offtake agreements, as well as Mina do Barroso's proposed financing. 

"The company remains focused on completing the project's definitive feasibility study and environmental impact assessment and permitting process, which will allow a development decision to be made," he said.

Savannah's shares have lost 14% in the past half a year to the current 5.65p (US7.4c).