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Oliver Kazunga Senior Business Reporter
AIM-LISTED African Consolidated Resources (AFCR) has cancelled plans to acquire Dalny Mine from Falcon Gold after failing to raise $12 million that constituted a pre-condition of the agreement to own the Kadoma-based gold mine. The news is a blow to Falgold, which had hoped to use the cash from the Dalny sale to breathe life into its waning operations. AFCR said it now awaits the re-imbursement of the money initially advanced to Falgold as part of the sale agreement. Falgold announced in August this year that its shareholders had approved the sale of Dalny to AFCR.
“African Consolidated Resources has not been able to raise $12 million, which constitutes a pre-condition of its conditional agreement to acquire the Dalny Mine and associated infrastructure in Zimbabwe from Falcon Gold Zimbabwe,” said AFCR in a statement.
“AFCR has formally withdrawn from the Dalny agreement, and the acquisition of Dalny Mine for the purpose of trucking mined ore from the company’s Pickstone-Peerless mine will not go ahead. As a consequence of the termination of the Dalny agreement, AFCR is due reimbursement of $500,000 of the initial payment of $1 million held on account by Falgold.”
Dalny Mine was closed in August last year and placed under care and maintenance after Falgold cited liquidity problems triggered by falling gold prices and operational challenges such as high power costs. The mine placed its more than 900 workers on unpaid leave. AFCR said despite the failure to raise the $12 million for the Dalny acquisition, it had secured joint venture finance that would enable it to start mining at Pickstone-Peerless with a local partner.
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