Ghaghoo Mine acquisition deal collapses
Botswana Stock Exchange ( BSE) listed Botswana Diamonds has hit a brick wall in its efforts to secure a partner for Ghaghoo Mine acquisition. According to a company notice to shareholders, the deal with Gem Diamonds for the sale of its subsidiary, Gem Diamonds Botswana has lapsed.
“Despite intensive advanced and ongoing discussions with interested parties, the board has been unable to secure a new joint venture partner to acquire the Ghaghoo mine before the extended long- stop date of 10th May 2022,” said Botswana Diamonds in a statement released this week.
However, Gem Diamonds have indicated their willingness to re- engage on substantially the same terms as the Agreement, if BOD and a partner can finalise an agreement accordingly.
Botswana Diamonds says it continues discussions with potential joint venture partners.
In February, Botswana Diamond indicated that Okwa Diamonds, a joint venture with Vast Resources in which BOD has an initial 10percent carried interest, had conditionally agreed to acquire Gem Diamonds Botswana for a cash consideration of US$ 4 million. Under the terms of the joint venture agreement, VAST was responsible for funding Okwa with the first US$ 15 million of funding required for the purposes of carrying out due diligence, acquiring GDB and placing the mine back into production. However, VAST informed Botswana Diamonds and Gem Diamonds that they do not intend to proceed with the transaction. And Botswana diamonds had identified alternative potential partners to replace VAST as its joint venture partner in Okwa, before the collapse of the deal. Meanwhile, the new partner replacing VAST in the Okwa joint venture may require further approval from government authorities.