Firering Strategic Minerals PLC on Thursday announced it has agreed to acquire a substantial stake in a former Glencore PLC subsidiary and the Zambian limestone project it owns.
Firering shares were up 2.7% at 7.35 pence around midday in London.
The Abidjan, Ivory Coast-based exploration company, which is developing a mineral assets portfolio in the Ivory Coast, has signed an option deed dated yesterday to acquire up to 28% of Limeco Resources Ltd for $5.1 million.
‘Firering has been keen to add a production asset to its portfolio,’ said Yuval Cohen, Firering’s chief executive officer. ‘We believe this is a unique opportunity for Firering to diversify its investments and secure a stake in an advanced project which is commission ready with the potential to be in production within a year.’
Limeco currently owns a limestone project outside Lusaka, the capital of Zambia. It comprises a limestone quarry with an estimated non-JORC compliant mineral resource estimate of over 73 million tonnes, and a quicklime production facility.
Limeco was established by Glencore to obtain quicklime for its Mopane operations in Zambia, due to a shortage of quicklime in the country. Production from the limestone quarry ran from March 2016 to January 2017.
Cohen explained: ‘In 2021, Glencore sold its Mopane copper mine in Zambia to ZCCM Investments Holdings PLC for $1.5 billion resulting in Limeco being surplus to its requirements. Limeco has been at an effective standstill whilst the above sale of the Mopane copper mine was being negotiated.’
Firering entered the deed as a co-option holder with Clearglass Investments Ltd, with Limeco’s current shareholders. Clearglass will gain 5.0% of shares in Limeco, bringing the total option sold to 33%.
Firering will pay the $5.1 million consideration across two tranches, first $2.5 million for 17.5% and then $2.6 million for the other 11%.
Once the full option is granted, Firering will have the right to appoint either the CEO or chief financial officer of Limeco.
Firering said it expects Limeco to be profitable within the next 12 to 24 months, with a view to starting dividend payments as soon as possible.
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