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Stratex exits Turkey as it sells it Altintepe stake to JV partner

Stratex's board believes the exit price fully reflects the inherent value of Stratex's investment in Altintepe
Gold and dollar
Funds released from the sale will provide funds for new acquisitions

Stratex International plc (LON:STI) has sold its 45% interest in the Altintepe gold mine in Turkey to its joint venture partner, Bahar Madencilik.

The consideration of US$8mln cash is net of any taxes and costs, and marks Stratex’s exit from a joint venture where relations between the two companies, from the outside at least, had their ups and downs.

Estimates put production in 2016 at Altintepe at 35,800 ounces gold and 4,600 ounces silver, generating total revenues of around US$45mln.

Stratex, by virtue of its 45% stake, was due to receive 20% of net cash generated by the project until such time as the capital invested by Bahar Madencilik had been paid back, but the money was not forthcoming from Stratex’s joint venture partner.

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WATCH Stratex International's Marcus Engelbrecht on 'positive' talks with Turkey joint venture partner

READ Stratex says talks with Turkish partner over Altintepe cash “highly constructive”

Last week, Stratex’s chief executive officer Marcus Engelbrecht told Proactive Investors that talks with Bahar Madencilik had been positive.

Stratex board happy with the exit fee

Stratex’s board said it considered the settlement to be “highly accretive” and fully reflects the inherent value of the group’s investment in Altintepe.

As at 31 December 2015, Stratex's carrying value of the Altintepe joint venture was £17,821 and its share of losses for the year to 31 December 2015 was £158,474.

"This successful transaction marks another positive step in the evolution of Stratex as we pursue our vision of becoming a significant production, development and exploration company,” Engelbrecht said.

“Whilst the Altintepe Gold Mine has played an important role in the historic growth of the company, the funds released from this sale place Stratex in a strong position with respect to its advancing discussions with other companies with regard to near or in production assets. Furthermore, it will enable us to advance those of our exploration projects which we believe have the potential to unlock future value for our shareholders," he added.

The shares initially fell sharply on the news from 1.9p overnight to 1.6p before recovering to last night’s closing value.

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