(Alliance News) - AIM cash shell Richland Resources Ltd said Monday it has entered into a binding share purchase agreement with the existing shareholders of Global Asset Resources Ltd, which constitutes a reverse takeover under AIM rules.
Richland said Global Asset Resources Holdings, Inc holds a 51% interest in and operatorship of four gold exploration projects in North and South Carolina in the US.
Richland said the transaction comprises of an aggregate payment on completion to the sellers and GAR's joint venture partner, Uwharrie Resources Inc of AUD60,000 - approximately USD42,500 - in cash and AUD1.04 million - about USD737,500 - in new common shares.
The AIM-listed firm intends to fund the initial cash consideration, planned initial two-year work programme and requisite working capital requirements via the issue of new equity by way of a proposed private placing.
Further, Richland noted that it has proposed name change to Lexington Gold Ltd to reflect the "transformational nature" of the deal.
"We look forward to progressing this proposed transformational transaction to completion and thereafter pursuing our planned initial exploration programme to unlock the clear potential of the GAR Projects against the prevailing strong market environment for gold," said Chair Ed Nealon.
The company's shares remain suspended from trading in London until the deal closes.
By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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