Predictive Discovery Ltd (ASX:PDI) has progressed its divestment plans for non-core assets, with Manas Resources Limited (ASX:MSR) set to acquire Resolute Mining Limited's (ASX:RSG) (LON:RSG) (FRA:RSM) exploration interests in Cote D’Ivoire and concurrent agreement with Predictive to restructure the existing joint venture with Resolute - while allowing the company to retain an interest in potential discoveries on the JV permits.
As part of the JV restructure, Predictive will receive 100 million performance shares in Manas, which vest under certain resource discovery milestones and notably, will no longer be responsible for exploration expenditure and joint venture cash contribution.
Predictive will swap its 23.5% contributing equity interest in the Cote D’Ivoire joint venture for an 11% free-carried equity interest through to a ‘decision to mine’ following grant of a mining permit and completion of a definitive feasibility study.
“Retaining meaningful exposure”
PDI managing director Paul Roberts said: “Following the recent $26.5 million capital raising, we are totally committed to advancing the Bankan Gold Project as fast as possible.
“Beyond that, we have many other exciting exploration prospects within our 100%-owned Guinea projects to be working on, so the timing is right to eliminate the need for any ongoing funding commitment by us on these minority interests in Cote d’Ivoire, whilst retaining meaningful exposure to exploration upside at the properties.
The Nyangboue and Ouarigue South deposits are greenfield discoveries which, on their own, deserve undivided exploration attention.
“If not for the incredible opportunity at Bankan and elsewhere in Guinea, these Projects could be flagship company assets.
“As such, it was important that as part of the JV restructure, the company retained a strong interest in their upside.”
“Investment in safe hands”
The Manas-Predictive Joint Venture permits comprise the exploration permits Odienne Nord, Odienne Sud, Boundiali, Boundiali Nord, Beriaboukro and Ferke.
Roberts said: “Manas has a very capable team, with excellent in-country experience and a history of past success in Cote D’Ivoire and elsewhere.
"The company considers its investment to be in safe hands and represents a sensible transaction for both parties.”
Both the Predictive sale agreement and Manas-Predictive Joint Venture agreement are conditional upon completion under the Resolute sale agreement.
Manas shareholders will be required to approve the transaction, as Resolute holds about a 25% shareholding in Manas.
JV agreement terms
Upon a Decision to Mine, Predictive's and Manas's interests in the mining joint venture company will be diluted pro rata to account for any Cote d’Ivoire government interest, expected to be 10% and Predictive must either:
- Contribute to fund the project development in proportion to its interest; or
- Convert its interest to a 1% net smelter royalty (NSR); or
- Withdraw from the joint venture which grants Manas an option to acquire its interest at an independent valuation.
Predictive will remain free carried on exploration permits within the joint venture outside of the mining permit area.