Last checked at 13 Oct 2014 10:59
Red Rock Resources Plc
("Red Rock" or the "Company")
Sale of Colombian Interests - Update
13th October 2014
Red Rock Resources plc, the mining and exploration company with gold interests in Colombia, Kenya, and Ivory Coast, announces an update in relation to the proposed sale of its Colombian interests to Nicaragua Milling Company Limited ("NMC").
Further to the Company's announcement on 11th September 2014, Red Rock has now executed an amendment to the terms of the Letter of Intent ("LOI") to extend the outside date for exclusivity to 10th November 2014. The outside date for closing is 28th November 2014.
As noted in the Company's announcement of 11 September 2014, one of the purposes of extension was that NMC wished to purchase additional holdings in Four Points Mining SAS ("FPM") beyond the 50.01% held by Red Rock through American Gold Mines Ltd. The Company has received a copy of a signed contract whereby NMC has agreed to purchase an 11.2% shareholding held by a local shareholder and NMC has informed the Company that it has made an initial payment on this contract which is for completion on 24 November. Further, NMC has announced that it has entered into a binding letter of intent with Prize Mining Corporation ("Prize"), listed on the TSX, to acquire a 61% stake in the El Limon mine, the principal asset of FPM, following completion of the transaction between the Company and NMC.
NMC has stated that its intention is to raise money via Prize for the future development of El Limon plant and infrastructure. NMC has also stated that the ability of NMC to execute with Red Rock is not contingent on the Prize transaction. Further details of the proposed Prize transaction are given at the following website: http://www.marketwired.com/press-release/prize-announces-letter-intent-acquire-majority-interest-el-limon-mine-colombia-tsx-venture-prz.h-1953378.htm#.VDQMSdub96A.email
Currently the Company does not expect the transaction between NMC and Prize to affect Red Rock's transaction timeline. Further announcements will be made as the transaction progresses.
Company Chairman Andrew Bell comments:
"Following NMC's agreement to buy out a minority shareholder in El Limon, we have agreed to extend the exclusivity period until November, with final closing still set for that month. At completion NMC is now expected to own 61.2% of El Limon. The efforts made by NMC to secure an additional 11.2% stake and their entering into a derivative transaction with Prize demonstrate clearly their commitment to our transaction. A group from the buyer was on site last week at the mine, and the parties are working together on the remaining stages."
For further information, please contact:
Andrew Bell0207 747 9990 or 0776 647 4849 Chairman Red Rock Resources Plc
Roland Cornish/ Rosalind Hill Abrahams 0207 628 3396 NOMAD Beaumont Cornish Limited
Jason Robertson 0129 351 7744 Broker Dowgate Capital Stockbrokers Ltd.
Rupert Trefgarne 0203 128 8817 Media Relations MHP Communications