(Alliance News) - Bezant Resources PLC on Monday said its sale of an 80% interest in the Mankayan copper-gold project in the Philippines to Mining & Minerals Industries Holding Pte Ltd could be in jeopardy.
Shares in Bezant were down 14% at 0.11 pence in London in late morning trading.
Mining & Minerals agreed to make a funding commitment of up to USD2.3 million for exploration - plus a further funding commitment of up to USD2.2 million through creation of a definitive feasibility study - in order to acquire the stake though a reverse takeover transaction.
The buyer has since applied to the Singapore Stock Exchange to extend the time period to complete its reverse takeover and was initially denied, but has since lodged an appeal on the grounds that the buy had "been hampered by the Covid-19 pandemic".
Mining & Minerals is also "pursuing alternative opportunities to achieve a potential listing and fundraising on certain other recognised global stock exchanges" should the deal or similar initial public offering on the Singapore Stock Exchange not go through by the December 31 deadline.
Lockdown measures in the Philippines have only just begun to ease and have meant no exploration activity at the Mankayan project since the lockdown began in mid-March. Singapore, likewise, has been under a two-month lockdown and is only slowly easing its restrictions.
Given this, Mining & Minerals has advised Bezant that is has not been able to meet its expenditure commitments as required under the transaction agreement between the two firms. So far, an application has been made to the Philippine Government Mining Agency requesting an extension of the exploration period and work programme commitment revisions.
In addition, Mining & Minerals has "engaged an independent expert to update the JORC 2004 resource information to JORC 2012" and completed the required "technical and social audits for 2018".
In light of all that has happened, and the pandemic itself, Bezant has opted "to defer taking any action or granting any waiver" until the outcome of the extension application is known or more information is provided as regards Mining & Minerals' "listing and funding strategy".
Bezant is, however, reserving its position and its rights under the transaction agreement with Mining & Minerals.
More information and clarification from Mining & Minerals is expected in the third quarter of the year and more updates will follow "as and when appropriate".
By Anna Farley; annafarley@alliancenews.com
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Bezant Res (BZT)