Ann: Sekoko and Ariona Sign SPA , page-3

JOHANNESBURG (miningweekly.com) – ASX- and JSE-listed Firestone Energy on Friday said that its major shareholder Sekoko Resources had signed a formal share sale and purchase agreement with a consortium of international investors, which would control between 19.9% and 25.69% of Firestone’s issued capital.

Firestone announced in May that Sekoko had entered into a binding term sheet with Ariona, which is the special purpose vehicle representing the international institutional and private investors, for the sale of 800-million Firestone shares.

The terms of the agreement included that Ariona acquire a minimum of 622-million shares in Firestone from Sekoko for A$6.22-million, or a maximum of 800-million shares for A$8-million.

Ariona would also acquire a 10% interest in Firestone’s Waterberg JV coal project in South Africa, either directly from Sekoko or through acquiring a 25% shareholding in the wholly owned subsidiary of Sekoko that held the Waterberg interest, for about A$20.5-million. Sekoko would maintain its 30% interest in the project.

Firestone said in a statement that these transactions were subject to a number of conditions precedent, such as the completion of a legal, financial and technical due diligence satisfactory to Ariona.

Ariona also had to enter into a formal agreement with Firestone for the provision of A$30.7-million in funding through the issue, by Firestone, of secured convertible notes to Ariona and obtaining all necessary regulatory and shareholder approvals.

Further, the transaction would include Ariona undertaking to procure project funding for the development of the Waterberg JV of up to $400-million.

Aspects of the transactions that would require shareholder approval were, among others, Ariona acquiring more than 20% of Firestone, as an exception to Ariona making a formal takeover offer for Firestone.

Firestone indicated that it would commission a report to assess whether the transactions were fair and reasonable for shareholders that were not participating.
Edited by: Reuters