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Laneway Resources (ASX:LNY) - Executive Chairman, Stephen Bizzell - The Market Herald
Executive Chairman, Stephen Bizzell
Source: Courier Mail
  • Laneway Resources (LNY) has entered an agreement with Aus Tin Mining (ANW) to sell its Ashford Coking Coal Project in two stages
  • Stage one will give Aus Tin the option to purchase a 40 per cent interest in either Ashford itself or Laneway's subsidiary who owns the project
  • Laneway expects receive approximately two billion Aus Tin shares for the initial interest in the project following Aus Tin's proposed capital raise and debt for equity conversions
  • Stage two will give Aus Tin the option to purchase the remaining 60 per cent interest for $7 million across a three year period
  • Laneway ended Friday's session 10 per cent in the red to trade for 0.9 cents

Laneway Resources (LNY) has entered into an agreement with Aus Tin Mining (ANW) to sell its Ashford Coking Coal Project.

Stage one

Laneway will sell its project in two stages. Stage one will give Aus Tin the option to purchase a 40 per cent interest in either Ashford itself or Laneway's subsidiary who owns the project.

Aus Tin is currently in a trading halt ahead of a proposed capital raise.

Based upon the capital raise and debt for equity conversions of at least $1.66 million, Laneway is expecting to receive approximately two billion Aus Tin shares for the initial interest in the project.

However, for this deal to go through, both companies will need to be satisfied with the results of legal, financial and technical due diligence and will need shareholder approval.

Another condition under stage one includes Aus Tin undertaking a rights issue to raise at least $1.2 million in cash to fund exploration, development and corporate costs.

If conditions have not been met by October 31 2020, then either Aus Tin or Laneway may terminate the deal. If the deal does go through, Laneway can nominate two directors to join the board of Aus Tin.

Stage two

Stage two will give Aus Tin the option to purchase the remaining 60 per cent interest in the Ashford Project. The $7 million deal will give Aus Tin three years to purchase the rest of the project.

Additionally, there will be an ongoing royalty payable to Laneway at 50 cents per tonne of coal sold from the Ashford Project.

Stage two is subject to a number of conditions including shareholder and third party approval, expiry or termination of Aus Tin's Lind Facility. If these conditions are not satisfied, Laneway can ask for stage one's interest back from Aus Tin.

At the end of Friday's session, Laneway is down 10 per cent and is trading for 0.9 cents per share.


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