Force Commodities (ASX:4CE) is selling its non-core Halls Peak base metal project in NSW for up to $665,800 as it narrows its focus to developing its highly promising Congo-based lithium projects.
Option agreements have been signed for the sale of the two Halls Peak zinc-lead-copper-silver tenements to private company XS Resources Ltd which is planning to list on the ASX.
Under the deal, Force will receive $165,800 cash, plus $250,000 worth of shares in XS Resources’ IPO and a further $250,000 worth of XS Resources’ shares once $2 million or more worth of sales are made from the project.
With our focus firmly fixed on exploration and development of our highly promising lithium projects in the Congo, the decision has been made to dispose of the Halls Peak Project, a non-core asset,” Force’s managing director Jason Brewer stated.
“Whilst I believe the Halls Peak Project has significant merit, with the opportunity we now have in Africa, we cannot afford any distraction from our plans to accelerate exploration and development activities at the Kitotolo and Kanuka Lithium Projects.
Mr Brewer said the company had been actively seeking interest in the Halls Peak Project for over nine months with XS Resources’ proposal the most attractive offer on the table.
“We are keen to retain some interest in the Halls Peak Project given its potential and it is for this reason that we agreed for part of the proceeds to be in the form of equity in the acquiring entity – just as we have successfully done with our equity investment in Marquee Resources (ASX:MQR) and as we recently did with the Mt Adrah Gold Project,” he said.
Meanwhile, Force Chief Financial Officer and Company Secretary Michael Fry has been appointed a director of acquirer XS Resources and will play a pivotal role in the planned ASX Listing of XS Resources and realisation of value for Force.
“We have a vested interest in the planned IPO of XS Resources performing well and to this extent we strongly support the role Mr Fry will play as a director of XS Resources in assisting it to successfully complete its IPO and in the advancement of the Halls Peak Project in his capacity as a Director of XS Resources,” Mr Brewer added.
Shares in Force finished the week at 5.8c.