The mining company Ivanhoe Mines Ltd will sell 1 per cent of its share interest in Kamoa Holding Limited to the British Virgin Islands-incorporated private company Crystal River Global Limited, for US$8.32 million which will be paid through a non-interest-bearing, 10-year promissory note. The BVI company is headquartered in HK and controlled by Mr. So Hon Chun who had been involved with Ivanhoe Capital Corporation. Kamoa Holding Limited is the subsidiary of Ivanhoe which presently owns 95 per cent of the Kamoa Project in Central Africa – one of the three principal projects of Ivanhoe, also positioned to become one of the world’s largest copper mines.
The agreement between Ivanhoe and Crystal River is part of the agreement signed between the mining company and Zijin Mining Group Co., Ltd to a strategic co-development in the Kamoa copper discovery. Under its terms, Zijin, through its subsidiary Gold Mountains (HK) International Mining Company Limited, will buy a 49.5 per cent interest in Kamoa Holding, for an aggregate amount of US$412mln.
Zijin also committed to arrange or procure the financing of the Kamoa project for 65 per cent of the capital needed for the first phase of work. Upon the successful arrangement or procurement of the project financing, Zijin will have the right to acquire 1 per cent share interest in Kamoa Holding, purchased by the BVI company. If the 1 per cent option is not exercised within seven years, it will expire, and then both parties will have the right to purchase one-half of the 1 per cent from Crystal River. Upon closing of the transaction, each shareholder will fund Kamoa Holding proportionately to its interest.
