Mineral developer and explorer Cyclone Metals (ASX:CLE) has struck a deal to sell its non-core gold assets to BVI-registered company Moosh Moosh for $4 million.
Cyclone, which has a $20.52 million market capitalisation, says it has signed a binding term sheet to sell 100% of its interest in several tenements comprising the Nickol River Project in the West Pilbara region of Western Australia.
In addition, Cyclone has agreed to sell several tenements located on the North and South Islands of New Zealand.
In return for the projects, Cyclone will pocket $4 million in cash or shares in an ASX-listed company or NZX-listed company to be paid by Moosh.
Cyclone shall also be entitled to a 1% net smelter royalty on minerals extracted from the tenements.
The Nickol River and New Zealand projects sale is anticipated to complete by no later than 29 September 2023, or at the satisfaction or waiver by Moosh of the Conditions Precedent.
The conditions include the completion of due diligence (DD) by both parties no later than 29 September 2023 and the payment of $200,000 from Moosh to Cyclone for maintaining tenements in good order during the DD period. This amount will be refundable if the transaction does not complete.
Cyclone says the Nickol River and New Zealand projects are considered non-core assets, and their sale is a key step in Cyclone’s strategy to focus on developing its flagship Block 103 Magnetite Iron Ore Project, located in the Labrador Trough region of Canada.
Commenting on the sale, Cyclone Metals Chief Executive Officer (CEO) Paul Berend says: “This sale of non-core assets illustrates our commitment to the development of our world-class iron ore project Block 103 whilst ensuring that our investors retain exposure to the upside of these gold assets via a royalty stream and/or equity stake.
“This sale of non-core assets illustrates our commitment to the development of our world-class iron ore project Block 103…”
Both Block 103 and these gold assets will benefit from a dedicated management team and board.”
Cyclone Metals is an ASX-listed company with a portfolio of projects and investments that provides exposure to gold, lithium, iron ore, copper, uranium, and lead-silver-zinc assets in Australia, Canada, Europe, Africa, and South America.
On 31 March 2023, the company had $505,000 cash at hand, according to its latest quarterly report published on 26 April 2023.
Write to Aaliyah Rogan at Mining.com.au
Images: Cyclone Metals Ltd
