China's Chifeng Jilong walks away from deal to buy Ghana gold mine (updated)

Afrika Gold AG

19/04/2021 13:07

(Adds detail, background, attempt to seek comment from
Resolute)
    April 19 (Reuters) - China's Chifeng Jilong Gold Mining
 600988.SS  on Monday cancelled an agreement to buy the Bibiani
gold mine in Ghana, saying it had not received timely
information from the seller about the termination of the mining
lease. 
    Australia-based Resolute Mining  RSG.AX  agreed to sell
Bibiani to Chifeng Jilong for around $105 million in December,
apparently extending a flurry of Chinese M&A in the gold mining
sector, only to announce last month its lease had been
terminated by the Ghanaian government.  urn:newsml:reuters.com:*:nASN000ZMK
    The lease was restored last week under terms that did not
recognise the sale.  urn:newsml:reuters.com:*:nL4N2M71HP
    In a filing, Chifeng Jilong said Resolute had been told in a
Nov. 6 letter from Ghana's Minister of Lands and Natural
Resources that the lease had been terminated but "did not
disclose" the information.
    Resolute did not immediately respond to a request for
comment outside of normal business hours.
    The Chinese firm, which urged Resolute to refund an advance
payment of around $5 million, said it only found out about the
minister's letter on March 24, when Resolute announced it had
received a separate letter from the Ghanaian Minerals Commission
saying the lease had been terminated.
    The deal would have marked Chifeng Jilong's second overseas
acquisition, after it bought a 90% stake in the Sepon gold and
copper mine in Laos in 2018. 
    The company said the cancellation of the Bibiani deal would
not adversely affect its overall business development and
operations.

 (Reporting by Tom Daly; additional reporting by Helen Reid in
Johannesburg; Editing by Toby Chopra and Susan Fenton)
 ((tom.daly@thomsonreuters.com; +86 10 5669 2119;))