PERTH (miningweekly.com) – ASX-listed Avenira plans to sell its interest in the Baobab phosphate project, in Senegal, and its 7% interest in phosphate technology company Novaphos to a consortium of its three largest shareholders.
Under the terms of binding agreements reached with Agrifos Partners, Tablo Corporation and Agrifields DMCC, Avenira will divest of its interest in Baobab and Novaphos and undertake a buyback and capital reduction of all the Avenira shares and options held by the buyers for nil consideration.
In return, Avenira will receive a A$4.3-million cash consideration and a loan and director fees forgiveness of some A$1.8-million. Pending the completion of the sale, the buyers will also provide Avenira with loan funding of up to $1.8-million for its subsidiary Baobab Mining and Chemicals Corporation, and will also make additional loan funding available to Avenira which, if used, will be deducted from the cash consideration.
Avenira chairperson Brett Clark on Monday said Avenira would move to become debt free, with cash available to re-examine its large Wonarah phosphate project, in the Northern Territory, and other investment opportunities.
“We are grateful for the support of Avenira’s shareholders through to this point. With the support of the major shareholders, we have been able to structure a transaction that not only relieves considerable financial stress facing the company, but also affords Avenira shareholders an opportunity to continue with the ability to trade their shares, as well as crystalise the value of the Baobab and Novaphos interests.”
As part of the transaction, Farouk Chaouni and David Mimran have resigned from the Avenira board, while Timothy Cotton will resign on completion of the transaction. MD and CEO Louis Calvarin will also step down, but will continue on as an independent nonexecutive director until the completion of the transaction.
Clark and Calvarin have unanimously recommended that shareholders vote in favour of the transaction at an upcoming shareholders meeting.
Avenira's share price fell by nearly 17% on Monday, trading at a low of 0.5c a share, down from the opening price of 0.7c a share.