Rose Petroleum PLC (LON:ROSE) told investors that the deal to sell its Mexican milling operation is proceeding, after the buyer Magellan Gold Corp made the extended August 15 deadline.
“The company is pleased confirm that it has received from Magellan both the irrevocable commitment letters totalling US$900,000 to fund the purchase and the first US$25,000 cash payment relating to the August 2017 running costs of the mill,” Rose said in a statement.
The company added: “Rose and Magellan are now pushing forward to complete the transaction.”
Closing is still subject to conditions such as approval by Rose shareholders, Magellan entering into a separate asset purchase agreement and both companies' due diligence. The total price for the asset amounts to US$1.5mln, with US$1mln in cash.
Activity in the gold milling business is presently on hold, pending the deal’s completion.
Matthew Idiens, Rose Petroleum chief executive, said: “We are pleased with the progress being made on the disposal of the SDA Mill and, subject to signing of the sale and purchase agreement and satisfactory completion of due diligence, we expect to be in a position to convene the general meeting to seek shareholder approval to complete the disposal in the coming weeks.
“We will keep the market updated on the process."