Alderon Iron Ore Corp and Tunghsu Group Corp have entered into a Letter of Intentto invest in the Kami Mine Limited Project.
The investor is expected to acquire 26–38pc interest in the project, which is worth $15-23mn. A firm agreement is slated for March 15, with the transaction to be completed by April 30.
Both companies will bear the proportional pre-production expenses before starting the Kami project. Expenses, including working capital and operating costs, interest and financing charges, and administrative costs will be assumed by both firms. Either company that fails to provide its share will be diluted based on an established dilution formula.
Kami’s managing general partner will be increased to five, and provided the investor acquires 38pc interest in the project, they will be entitled to nominate two to three board members for the project.