China’s Zijin Mining is investing in the Mongolia-focused Xanadu Mines, allowing the latter company to progress the development of its flagship Kharmagtai copper-gold project.
“Under the Agreement, Zijin will invest in both the Xanadu corporate level and the Kharmagtai project level through a series of transactions commencing with the subscription of 139 million fully paid ordinary shares in Xanadu … to provide Zijin with a 9.9% shareholding in the Company (Phase 1 Placement),” Xanadu Mines said in a statement.
The phase 1 placement is valued at about A$5.56 million (US$4.2 million), according to the statement.
“Two subsequent phases are then proposed (subject to formal docu-mentation) including a second placement of ordinary shares at A$0.04 per share to increase Zijin’s total shareholding in the Com-pany to 19.99% (Phase 2 Placement) and the creation of a 50/50 Joint Venture in Khuiten Metals Pte. Ltd., the entity currently 100% owned by Xanadu that holds a 76.5% effective interest in Kharmagtai (Phase 3 JV), for a cash payment of US$35 million,” Xanadu Mines said.