TNG Limited receives initial A$2m funding from Chinese transaction with ECE

TNG Limited (ASX: TNG) will use an initial A$2 million funding injection from a transaction with a Chinese group to underpin ongoing Pre-Feasibility work at the Mount Peake Iron Vanadium Titanium Project.

Funds will also support the pilot plant test work program to commercialise the TIVAN™ hydrometallurgical process.

TNG has received the funds under a binding Letter of Intent (LOI) with a private company introduced by Jiangsu Eastern China Non-Ferrous Metals Investment Holding Company Ltd, (ECE).

The facility is designed to provide interim working capital prior to completion of the main transaction with ECE, which comprises a A$13.4 million investment for a 30% cornerstone stake in TNG - priced at $0.11 for around 122 million shares.

Importantly for existing shareholders, the investment has been struck at a premium to the $0.093 price before TNG entered the trading halt to make the announcement.

Paul Burton, managing director of TNG, said that he was pleased to report that the transaction with ECE announced last month was progressing well and on schedule.

“The receipt of this interim funding of $2 million provides confidence in the intention of both parties under the LOI, and ensures that we can continue to maintain our pace of exploration, pre-feasibility and development work at Mount Peake while we complete the approvals and documentation required to conclude the broader transaction and Strategic Alliance.

“We are looking forward to concluding this transaction, which will lay the foundations for further growth of the company and the development of the Mount Peake Project as the cornerstone of a substantial ferrous metals business.”

TNG added that the due diligence process is proceeding on schedule, with ECE’s due diligence clearing the way for the process of obtaining other key approvals.

These include TNG shareholder and other regulatory approvals, including the Australian Foreign Investment Review Board and Jiangsu Provincial People’s Government.

Originally published at: http://www.proactiveinvestors.com.au/companies/news/19337/tng-limited-receives-initial-a2m-funding-from-chinese-transaction-with-ece-19337.html