AIM-listed mining company Gemfields gas has snapped up a 75 per cent stake in a Mozambican ruby project.
The company, which has a market capitalisation of £99.59m, entered into a conditional agreement to acquire a controlling interest in an additional ruby deposit located adjacent to the company's Montuepez ruby mine in the Cabo Delgade province of Mozambique.
The project, initially targeting one specific exploration licence, includes the option to acquire a second licence, both of which are currently owned by EME Investimentos S.A. and cover approximately 18,400 and 14,900 hectares respectively.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
The total consideration payable is $3.5m and is to be paid in cash in two instalments.
Ian Harebottle, Chief Executive Officer of Gemfields, commented: "The conditional agreement announced today has the potential to significantly expand our footprint in what we believe to be an exciting large-scale ruby province."
"We are particularly pleased to be able to provide this update to our shareholders given the considerable progress we have already made. The early indicators from the ongoing bulk sampling at our adjacent Montepuez project are encouraging."
He added: "We have received positive support from both the regional and national Mozambican authorities for our activities to date and I have little doubt that this, our second project within Mozambique, is unlikely to be the last and that the continued expansion and development of our Mozambican operations will prove to be a key element of Gemfields' continuing growth strategy."
Equity release rates drop – is it worth unlocking cash from your home?
News Lifetime mortgage rates are falling from their record highs - is equity release worth another look?
By Marc Shoffman Published
Hargreaves Lansdown launches fixed-term cash ISA product
savings/hargreaves-lansdown-fixed-cash-isa-launch Investment platform Hargreaves Lansdown is to offer fixed term cash ISAs via its Active Savings platform paying 4.8%, tax free - but is it any good?
By Kalpana Fitzpatrick Published