(Alliance News) - Endeavour Mining PLC on Friday said it has the closed the sale of its majority stakes in two "non-core" projects in Burkina Faso, netting over USD300 million.
The gold miner sold its 90% stakes in the Boungou and Wahgnion mines to Lilium Mining, part of African and frontier markets-focused investor Lilium Capital. Lilium is led by entrepreneurs in west Africa. The state of Burkina Faso owns the remaining 10%.
"The total consideration is expected to exceed USD300 million and is comprised of upfront and deferred cash considerations and net smelter return royalties," Endeavour added.
Endeavour explained that USD130 million will be received by the end of the July, in the form of a reimbursement of old shareholder loans. It added that USD25 million will be paid in two instalments as part of a deferred cash consideration.
There is also another deferred cash consideration, calculated at 50% of net free cash flow generated by Boungou, until USD55 million has been paid. Endeavour expects that threshold to be crossed in the fourth quarter of 2024.
There also will be net smelter royalties at Boungou and Wahgnion, netting the FTSE 100 listing USD52 million and USD41 million, respectively.
Endeavour altered annual guidance following the sale. It 2023 output guidance has been cut to a range of 1.06 million to 1.14 million ounces of gold. It had previously predicted yearly production between 1.33 million to 1.43 million gold ounces.
Shares in the company fell 1.7% to 1,832.00 pence each in London on Friday morning.
By Eric Cunha, Alliance News news editor
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Endeavour Mining (EDV)