Sundance Resources has secured a $58 million investment from AustSino Resources that will be used to develop its flagship Mabalam-Nabeba iron ore project in Central Africa.
The investment includes $50 million towards the cancellation of Sundance’s current convertible notes and $8 million in cash for the advancement of Sundance’s Mbalam-Nabeba project, located on the border of Cameroon and the Republic of the Congo.
AustSino will make two placements: one of 62.5 million fully paid ordinary shares at 0.4 cents per share, and a second of around 10.5 billion shares at 0.55 cents per share in addition to 10.5 billion unlisted options at 2 cents per option.
The second placement is subject to shareholder approval.
As a result of the agreement, Sundance will be debt free and have the ability to advance its key project.
Sundance chief executive officer Giulio Casello called it a transformational deal for the company.
“I wish to thanks AustSino and our noteholders for their engagement in delivering this win-win scenario, which enables Sundance to progress development of this truly world-class iron ore project,” he said.
“AustSino has made clear its intent to see Mbalam-Nabeba developed and together we will soon be travelling to Cameroon and Congo to demonstrate how they can help develop the project.”
In addition to the Sundance deal, Western Australian Port Rail Construction (WAPRC) announced that it intends to acquire a majority share of AustSino in a $100 million placement.
AustSino’s key project is the Peak Hill iron ore project in Western Australia, which contains a JORC complaint maiden resource of 700Mt at an average 27.5 per cent iron at its main deposit Telecom Hill.
WAPRC’s placement, which is binding but still subject to conditions, will see the company subscribe for roughly 7.69 million shares at a price of 1.3 cents per share, equivalent to a 61 per cent controlling interest in AustSino.
As a result of this placement, WARPC intends to work with AustSino on projects across Western Australia and Central Africa.