THE BOURSE WHISPERER: Potash West (ASX: PWN) informed the market that a binding term sheet has been executed between East Exploration Pty ltd and Petratherm Limited (ASX: PTR).
The deal is important to Potash West, as the company owns 55 per cent of East Exploration, with the balance held privately.
“We have signed a binding MOU to vend our German potash exploration project into a listed ASX shell, Petratherm,” Potash West managing director Patrick McManus said.
“The deal is supported by Taylor Collison, who will raise $4 million to 4.5 Million for PTR.
“Post this transaction, Potash West will own 26 per cent of the new, funded company.
“In addition there will be significant performance shares, granted on the achievement of project milestones.”
East Exploration holds exploration licences having an area of nearly 450 square kilometres in the southwestern edge of the South Harz Potash District in central Germany.
The Küllstedt Exploration Licence extends over 241sqkm while the Gräfentonna Exploration Licence has an area of 216sqkm.
Both licences are located in the northwestern part of the Federal State of Thuringia, bordering the city of Mühlhausen to the south.
“This transaction is a major step forward for Potash West and our shareholders,” McManus said in the company’s announcement to the Australian Securities Exchange.
“The South Harz project will now have a focused, and well-resourced team to take it forward.
“Whilst maintaining a significant exposure to South Harz, the company can continue to progress its other projects: The Dinner Hill project in the Dandaragan Trough and its ground-breaking extraction technologies, the 100 per cent-owned K-Max technology and the 25 per cent-owned Li-Max technology.”