CFE own 19.9% of TGF .Australian gold miner advances sale of...

CFE own 19.9% of TGF .


Australian gold miner advances sale of Chinese gold project
Tianshan Goldfields said Monday its plan to sell its entire portfolio of Chinese assets to a Hong Kong company was progressing to plan.

Author: Ross Louthean
Posted: Monday , 19 Oct 2009

PERTH -

Tianshan Goldfields Limited (ASX: TGF) has signed a memorandum of understanding to sell its 90% stake in the Gold Mountain gold project in north west China and other assets to China Power Sino Renewable Resources Ltd for $US22.5 million.

Tianshan's managing director Jason Bontempo said Sino Power had informed the company it had "successfully completed" due diligence on the assets.

Sino Power has already paid a deposit of $US1 million to Tianshan.

Bontempo said Sino Power now wants to formalise and execute the formal sale agreement between the parties - a document to be finalised in the coming weeks.

The sale was subject to shareholder approval, and a meeting has been called for November 6.

Tianshan made the decision to sell its Chinese portfolio based on a review of its assets and future strategy by the current board in recent months.

This review determined the company could, on balance, maximise returns to the company and its shareholders if it was able to execute a full or partial sale of its Chinese assets and use the funds raised to acquire interests in other companies or projects, some of which have been identified by the company.

"Tianshan has identified a range of opportunities at both the project and company level that it believes can return significant value to the company and its shareholders in a more suitable time-frame," Bontempo said.

Post the transaction Tianshan will have cash reserves - based on an $A=$US exchange rate of A90 cents, of more than $A30 million.

The Gold Mountain project was being advanced towards commissioning in 2010 and was earmarked to produce between 80-100,000 ounces of gold per annum.