Kasbah Resources receives buy recommendation and $0.65 target...

Kasbah Resources receives buy recommendation and $0.65 target from Australian broker

http://www.proactiveinvestors.com.au/companies/news/26413/kasbah-resources-receives-buy-recommendation-and-065-target-from-australian-broker-26413.html

Kasbah Resources receives buy recommendation and $0.65 target from Australian broker
Thursday, March 15, 2012 by Proactive Investors Kasbah Resources (ASX: KAS) has received a buy recommendation from an Australian broker with a $0.65 price target being applied, which is more than double the last traded price of $0.29.

The recommendation came after the recent deal between Kasbah and the Japanese trading company, Toyota Tsusho - which has agreed to acquire a 20% interest in the Achmmach tin project.

Toyota Tsusho trades around 8% of the global tin market and more than 50% of all tin consumed in Japan.

To earn its 20% interest in one of the largest undeveloped tin deposits in the world, Toyota Tsusho must make a series of payments to Kasbah, which will be used for exploration and development works at Achmmach, as well as finalise a joint venture agreement.

Toyota Tsusho must pay Kasbah A$1 million on signing the MoU, which is non-refundable, $4 million within 45 days of signing the MoU, $11 million within 60 days of completion of the Pre-Feasibility Study, and a final payment to be calculated from the net present value of the Definitive Feasibility Study and paid within 90 days of completion of the study.

The final payment and signing of a joint venture agreement will secure Toyota Tsusho’s 20% interest and entitle the company, on mutually agreeable commercial terms, to a minimum 20% offtake of tin produced from these two exploitation permits.

Kasbah will manage and operate the joint venture.

If the option payments are made by Toyota Tsusho, Kasbah will provide security over shares in Kasbah Gold SARLAU, which holds the Achmmach permits, to Toyota Tsusho.

Importantly, this security can be enforced in the event that Kasbah has not completed the Pre-Feasibility Study by 31 December 2012 or the Definitive Feasibility Study by 31 December 2013.