Triton Minerals' Strategic Sale of Mozambique Graphite Assets
TON (TON) Share Update July 2024 Sunday 28th
Triton Minerals Announces Sale of 70% of Mozambique Graphite Assets for A$17 Million
Triton Minerals Limited (ASX: TON) has announced a significant strategic move by selling 70% of its Mozambique Graphite Assets to Shandong Yulong Gold Co. Ltd. for A$17 million in cash.
Instant Summary:
- Sale of 70% of Mozambique Graphite Assets for A$17 million.
- Transaction to be completed in three stages with initial deposit of A$2.55 million already received.
- Triton retains 30% interest in the joint venture.
- Shandong Yulong to manage daily operations of the joint venture.
- Applications for DUAT and Resettlement Action Plan submitted.
- Company held A$0.78 million in cash as of 30 June 2024.
Transaction Details
On 2 July 2024, Triton Minerals Limited announced the sale of 70% of its Mozambique Graphite Assets to Shandong Yulong Gold Co. Ltd. for A$17 million in cash. The transaction will be completed in three stages, with the initial deposit of A$2.55 million already received on 3 July 2024. The second payment of A$5.95 million will be made upon meeting certain conditions precedent, and the remaining A$8.5 million is due by 28 February 2025.
This strategic move is expected to leave Triton well-funded for value-accretive transactions. By retaining a 30% interest in the joint venture, Triton will continue to have exposure to the graphite market. The deal is subject to shareholder approval and other conditions precedent, with the aim to finalize the transaction by February 2025.
Project Development
The applications for the DUAT (Land use agreement) and Resettlement Action Plan have been submitted to the relevant provincial authorities in Cabo Delgado Province. Upon approval, these will enable the Ancuabe environmental license to be issued to Triton, which is expected in the coming months.
Corporate Information
As of 30 June 2024, Triton held A$0.78 million in cash and had no debt. The company received the initial deposit of A$2.55 million from the sale of the Mozambique Graphite Assets on 3 July 2024.
This transaction is expected to provide Triton with a substantial, near-term material cash balance, enabling it to fund its contribution towards the joint venture and assess value-accretive acquisitions. The involvement of Shandong Yulong, a company listed on the Shanghai Stock Exchange, brings financial strength and market position to the joint venture, which could positively influence Triton's stock price.
Investor Reaction:
Analysts have noted that this strategic move by Triton Minerals is a positive step towards ensuring the fastest development pathway for the Ancuabe Graphite Project. Investor sentiment appears optimistic, given the financial backing and operational expertise of Shandong Yulong.
Conclusion:
Investors should keep an eye on the finalization of this transaction and the subsequent developments in the Ancuabe Graphite Project. Triton's strategic partnership with Shandong Yulong is expected to bring significant value and growth opportunities.