Red Rock Resources (LON:RRR) has ended an agreement to buy a further 45% of Sugar Dragon, which indirectly holds a licence to distribute Candy Crush-branded confectionery in Greater China.
Red Rock’s Australian subsidiary Resource Star (RSL) had paid A$300,000 through a refundable deposit and granted an A$200,000 convertible loan to the confectionery group, which will now be converted into a 15% equity stake.
The decision follows investor feedback that the indirect holding structure of the Sugar Dragon assets might not achieve the optimal valuation for the business.
Andrew Bell, Red Rock’s chairman said: "The operations of Sugar Dragon appear to be performing satisfactorily and RSL believes that its 15% interest will prove a good investment.
“An early IPO will be the preferred outcome with the object of establishing a stand-alone valuation for the Sugar Dragon business.”
Separately, Red Rock announced that long standing non–executive John Watkins is to stand down, with corporate lawyer Sam Quinn appointed to replace him.
Scott Kaintz, who has been working as head of corporate finance for Red Rock’s sister company Regency Mines since 2011 also becomes an executive director.