Forestry Update

RNS Number : 7495W

Obtala Resources Limited

29 April 2016

 

29 April 2016

Obtala Resources Limited

("Obtala", the "Group" or the "Company")

(AIM: OBT)

Forestry Update

Obtala Resources Limited (AIM:OBT), the African focused agricultural and timber company, announces that it has received full settlement of US$900,000 from Basic Materials Limited as per the investment agreement announced on the 17 February 2016. The payment was received in two tranches, the initial payment of US$600,000 expected on 30^th April 2016 and the balance of US$300,000 due by 30 June 2016.

The funds are part payment for a minority 17.5% shareholding in Meradell Inc, which holds the timber production offtake rights over a designated 20,000 hectare concession only.

As per the 17 February 2016 announcement, three separate investors have agreed to acquire minority shareholding in three newly formed holding companies. Each holding company holds the production rights for harvested timber from one of the Company's concessions. Obtala, through its subsidiary companies, still owns and maintains the timber concessions, which cover a total area of 314,965 hectares. In return for this investment, the investors will receive a 5% fixed return on their investment, payable biannually and a pro-rata share of any income.

Obtala Resources Kevin Milne - Deputy Chairman Simon Rollason - Managing Director www.obtalaresources.com	[phone]
ZAI Corporate Finance Limited (Nomad)                 Ray Zimmerman John Treacy Jamie Spotswood	[phone]
Brandon Hill Capital  (Broker)      Jonathan Evans	[phone]

 

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