REG - Shuka Minerals PLC - Settlement of legacy dispute with Upendo Group

Shuka MineralsAnnouncement

15/02/2024 08:00

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RNS Number : 2621D  Shuka Minerals PLC  15 February 2024

15 February 2024

 

Shuka Minerals Plc

("Shuka" or the "Company")

Settlement of legacy dispute with Upendo Group.

Shuka Minerals Plc (AIM: SKA), an African-focused mine operator and developer,
is pleased to announce that it has signed a definitive settlement agreement
with Upendo Group who hold a historic residual 10% interest in the Rukwa coal
mining licence.

 

Upendo Group Settlement

The Company has signed a definitive settlement agreement with Upendo Group
("Upendo") who hold a residual 10% interest in the Rukwa coal mining licence.
The dispute with Upendo, regarding the interpretation of the "residual"
interest entitlements comprise, has been dragging on for many years. Upendo
had obtained a judgement for $110,000, with interest and costs and $108,000
was previously lodged by the Company with the Court in Tanzania, as announced
on 30 June 2023. Upendo was also seeking further amounts, including a
potential claim for 10% of all gross sales revenue from Rukwa, both
historically and going forward. The dispute has been vigorously defended and
where necessary/appropriate appealed by the Company in the Tanzanian courts.
It has been taking time, management resources and causing reputational and
relationship damage to the Company in-country. As a result, the Board believes
that a settlement drawing a line under the dispute is the most appropriate
route forward.

 

The settlement involves the immediate payment to Upendo Group of $110,000, the
immediate settlement of all proceedings and a waiver of all or any related
claims by all parties howsoever arising. The Company will use the funds
already lodged in Court to meet the majority of the settlement costs. In
addition, Upendo will have a right to nominate a director to be appointed to
the local Rukwa operating subsidiary which currently has 5 directors nominated
by the Company, and Upendo will earn a royalty of $1.95 per tonne of coal from
Rukwa sold and paid for by the customers of the Company from the date of the
settlement. Upendo agree to communicate the settlement to all the relevant
authorities in Tanzania. The settlement agreement provides that the royalty
described above and the right to nominate a Board member to the local company
are the only rights attaching to the Upendo residual interest in the licence.

Noel Lyons Chief Executive Officer, Shuka Minerals Plc said:

"We are very pleased to have achieved the amicable settlement with Upendo, as
it enables us to review and determine the strategic direction of our coal
mining interests at Rukwa, without the prospect of an overhanging legacy
dispute. This clears the way for us to be more decisive and cohesive in our
future decisions."

 

Enquiries:

 Shuka Minerals Plc                   +254 (0)743 303075

 Jason Brewer - Executive Director

 Noel Lyons - CEO

 Strand Hanson Limited                +44 (0) 20 7409 3494

 Financial and Nominated Adviser

 James Harris | Richard Johnson

 Tavira Securities Limited            +44 (0) 20 7100 5100

 Joint Broker

 Oliver Stansfield | Jonathan Evans

 Peterhouse Capital Limited           +44 (0)20 7469 0930

 Joint Broker

 Charles Goodfellow | Duncan Vasey

 Gathoni Muchai Investments           info@shukaminerals.com

 Financial PR and IR

 Faith Kinyanjui Mumbi

 

 

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