LONDON (Alliance News) - Richland Resources Ltd Monday said it has further reduced its operations in Tanzania as part of its ongoing strategic review, closing all its Tanzanite Experience retail operations because it couldn't find a buyer for them.
The AIM-listed gemstone producer and developer said it is in the process of finalising the sale of the Tanzanite Experience tanzanite and jewellery inventory, which it anticipates should be completed on or around February 2, and is finalising redundancy arrangements for those employees for whom it was not possible to find suitable employment for elsewhere in the company.
Last November, Richland had announced the sale of its mining operations in Tanzania to Sky Associates Group Ltd, a deal that still needs to be cleared by authorities in the country as well as by the South Africa Reserve Bank if necessary. It expects to get those approvals by February 24.
"Sky did not wish to acquire the Tanzanite Experience retail operations as part of its acquisition of the group's mining operation in Tanzania. The Tanzanite Experience retail operations have been dependent upon their link to and supplies from the group's tanzanite mine in Tanzania and the group has been unable to find a buyer for the Tanzanite Experience business as a going concern," Richland said in explaining its decision to close the retail operations.
"As the majority of the leases on retail premises of TTE were due to expire early in 2015 or could be terminated on 90 days notice, the Group has decided not to renew the applicable leases, to give notice to terminate the others, and to close its Tanzanite Experience retail outlets in Tanzania. The closure will not have a material effect on the net assets of Richland," it added.
Richland Resources has decided to focus on the redevelopment of the Capricorn Sapphire mine in Queensland, Australia, and said the project remains on target for plant commissioning and mining to commence in the first quarter of 2015.
Richland Resources shares were down 18.0% at 1.33 pence in London Monday morning.
By Steve McGrath; stevemcgrath@alliancenews.com; @stevemcgrath1
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