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London-listed Vast Resources said on Tuesday it had pulled out of a $4 million deal to buy Ghaghoo diamond mine in Botswana from Gem Diamonds, without giving reasons.
In August, Gem Diamonds entered into a binding share sale agreement with Okwa Diamonds, a joint venture between Vast Resources and Botswana Diamonds, for the sale of the mine which has been under care and maintenance since 2017.
The deal was expected to be completed in the first quarter of 2022.
“The company has informed Botswana Diamonds and Gem Diamonds of its intention not to proceed with the acquisition of Ghaghoo,” Vast Resources said in a notice to shareholders.
In a separate statement, Gem Diamonds said the sale of the mine was expected to continue as Botswana Diamonds had confirmed its commitment to conclude the transaction as originally envisaged as soon as possible.
“The parties have therefore agreed to extend the Longstop Date under the Sale Agreement from 31 January 2022 to 31 March 2022 to allow Botswana Diamonds to secure an alternative financing partner which will replace Vast Resources,” Gem Diamonds said.
Ghaghoo was estimated in 2014 to have a resource of 79.3 million tonnes at an average grade of 19.5 carat per hundred tonnes and diamond value of $242/carat.
(By Brian Benza; Editing by Mark Potter)
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