Last checked at 
LONDON (Alliance News) - Galileo Resources PLC on Thursday said it agreed to buy the Kabwe residual rights from BMR Group PLC for up to GBP375,000.
The Kabwe residual rights include Kabwe mining licence, the Kashitu zinc willemite exploration prospect and 15% holding in Enviro Zambia Ltd, but excludes BMR's small scale licence.
Galileo Resources holds 85% stake in Enviro Zambia, which owns 95% of the Star zinc project, located in Zambia.
The iron ore company said it will pay an up-front fee of GBP50,000 in cash for an option to conduct an exclusive deal. It will then pay further GBP50,000 in cash and GBP275,000 in shares.
Galileo Resources intends to issue 15.0 million shares to BMR at a price of 1.15 pence each. The stock was trading 0.4% higher on the day Thursday at 1.15p per share.
Following the transaction, Galileo Resources will hold an entire share capital of Enviro Zambia, thereby increasing its interest in the Star project to 95%. The remaining 5% of the Star project is held by the government of Zambia.
"The proposed acquisition of the Kabwe residual rights would complement the Star zinc project and the board considers this to be a valuable transaction relative to its mission to build a significant zinc resource in Zambia," said Finance & Technical Director Andrew Sarosi.
"The Kashitu prospect is near the Kabwe zinc-lead-vanadium tailings recovery project. Initial exploration will focus on identifying large zinc oxide and willemite - mineralised deposits and thereafter explore the possibility for further zinc mineralisation with sulphide potential," added Sarosi.
Shares in Galileo Resources were up 0.4% at 1.15 pence on Thursday.
