Afferro Mining, the west Africa focused iron ore company, is to sell its 38.5% stake in the Putu iron ore project in Liberia.
The sale, to the majority shareholder Severstal, will see an initial cash payment of $65m in addition to a deferred payment of $50m. If the project is then sold on to a third party Afferro will be due a further consideration.
The deal still needs to win regulatory and shareholder approval.
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Commenting on the transaction, Afferro's Chief Executive, Luis da Silva, said: "Divesting the minority stake in Putu to generate total cash proceeds of at least US$115 million allows the Company to focus on its 100% owned flagship Nkout project (in Cameroon) and minimises shareholder dilution."
Shares in Afferro jumped 40% in morning trading to hit 58.35p shortly after the announcement of the sale. Over the year to date the stock has fallen 67%.
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