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Bezant Resources agrees to sell stake in Mankayan copper-gold project

Bezant Resources agrees to sell stake in Mankayan copper-gold project

Bezant Resources (LON:BZT) has entered an option agreement to dispose of its stake in the Mankayan copper and gold project in the Philippines to Gold Fields Netherlands Services BV for up to US$70 million.

Investors cheered the news, sending shares in Bezant up 24 percent to 40 pence in early deals, giving it a market cap of £26 million.

The proceeds will allow Bezant to fund the ongoing work programme and further development of its Eureka copper and gold property in Argentina, which will now be its main focus.

Bezant also told investors that it will consider acquiring other “attractive” mineral projects with the sale proceeds, while the balance will be returned to shareholders.

Under the option agreement, Bezant will receive a non-refundable upfront payment of US$7 million.

Another US$63 million will be due if Gold Fields Netherlands decided to exercise the option to acquire the entire share capital of Bezant’s subsidiary Asean, which holds its 40 percent stake in Mankayan. Asean also has an option to buy the remaining 60 percent in the project.

“We are very pleased to announce this transaction with Gold Fields... with respect to the potential disposal of our wholly owned subsidiary, Asean, at a time of considerable macroeconomic uncertainty and volatility,” said executive chairman of Bezant Resources Gerry Nealon.

“The negotiation of this transaction with Gold Fields follows an extensive sale process conducted by the company with a number of interested parties and we believe represents the best means of delivering value to our shareholders in the relatively near term.”

Gold Fields already holds an option over Lepanto's Far Southeast copper and gold project, which is located adjacent to Mankayan. Bezant noted that it would take “significant investment in infrastructure and capital expenditure” to bring each of the respective projects into production.

The transaction, which was unanimously recommended by the Bezant board, is now subject to shareholder approval.

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