Future Global Resources (FGR) – new owners of the Bogoso-Prestea gold mine – is said to have rescinded its decision to pay some $15 million to former owners of the gold mine, Golden Star Resources (GSR) which forms part of the purchasing price of the latter’s 90 percent interest in the mine.
Making the disclosure via a press release sighted by norvanreports, GSR states FGR’s decision to not pay the said amount follows claims by FGR of various alleged breaches of the Share Purchase Agreement (SPA) between it and GSR.
“FGR has claimed that it is entitled to set-off its obligation to make such payment under the Share Purchase Agreement as a result of various alleged breaches of the Share Purchase Agreement, a claim which Golden Star and Caystar believe to be completely without merit,” read parts of the statement.
Per information contained in the press statement, GSR has demanded that Blue International Holdings (BIH) – the major shareholder of FGR – make the $15 million payment pursuant to the guarantee made by BIH in the SPA in view of the fact that FGR has declined to make the payment.
Adding that should BIH also decline to make the payment, GSR will consider all available avenues of recourse to recover fully all payments owed it by FGR under the SPA.
“In the event payment is not received from BIH, Golden Star and Caystar are evaluating all available avenues of recourse in order to seek full recovery of amounts owed by FGR under the Share Purchase Agreement,” ended GSR’s statement.
Golden Star Resources (GSR) Limited two months ago announced an amendment of its sale agreement of the Bogoso-Prestea gold mine in the Western region to Future Global Resources.
Announcement of the amended share purchase agreement was done by the company on Monday, May 31, 2021.
According to GSR, it had reprofiled ‘staged payments’ for the gold mine contained in the previous agreement by Future Global Resources Limited, to provide the latter with more time to complete ongoing financing transactions and the environmental bonding process for Bogoso-Prestea.
The reprofiled payments, as noted by GSR on its website are follows;
- $15 million payment that was due on May 31, 2021 will now be payable by no later than July 16, 2021;
- Should FGR complete a financing transaction prior to July 16, 2021, $5 million will be immediately payable to Golden Star with the remaining $10 million continuing to fall due on July 16, 2021; and
- An amount of approximately $4.6m (comprised of the working capital balancing payment of approximately $4.3 million and fees of approximately $0.3 million for services provided by Caystar to FGR pursuant to a transition agreement dated September 30, 2020) will continue to fall due by no later than July 31, 2021.
Previously, the ‘staged payments’ or deferred consideration payments were as follows:
- The $5 million payment that was due on March 30, 2021 will now be payable by no later than May 31, 2021;
- The $10 million payment that was due to be paid on July 31, 2021 will be brought forward for payment by no later than May 31, 2021; and
- An amount of approximately $4.6m (comprised of the working capital balancing payment of approximately $4.3 million and fees of approximately $0.3 million for services provided by Caystar to FGR pursuant to a transition agreement dated September 30, 2020) will continue to fall due by no later than July 31, 2021.
Read below details of the press release:
