Marula Mining (AQSE:MARU) has completed a due diligence review of licences held by Pangani Minerals, a step the Africa-focused mining and development company says supports progress toward acquiring a 95% economic interest in a portfolio of nine Tanzanian prospecting licences.
The licences cover approximately 170 square kilometres and sit contiguous to Marula's Kinusi Copper Mine, the asset management has flagged as the source of copper production destined for delivery to Traxys under an exclusive offtake running to December 2029.
Marula is negotiating the acquisition with three vendors: Rio Ashanti, Pangani Minerals and Mythos Metals Limited.
The company has paid a non-refundable option fee of $100,000, which will be credited against an $800,000 upfront payment if the option is exercised and the deal completes, leaving $700,000 payable at completion. A further $1.2m falls due in two instalments of $600,000 at 12 and 18 months after completion, which the vendors may elect to take in 20m new Marula shares instead of cash, subject to the resumption of trading on AQSE and any required approvals.
The vendors retain a 5% free-carried interest in the project with no funding obligation, which Marula can buy out at any time for $500,000 in cash.
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"We are now focused on progressing the transaction documentation with the Vendors and advancing the remaining steps required to move the proposed acquisition forward," said chief executive Jason Brewer.
Completion remains conditional on exercising the option, executing definitive transaction documentation, any regulatory and shareholder approvals, and Marula securing the additional funding needed to pay the completion consideration, with no guarantee such funding will be secured.
The update follows Marula's announcement of 11 September and comes as the company has said it continues to manage a constrained working capital position across its existing Tanzanian and Kenyan operations.