The Australian iron ore exploration company Murchison Metals Ltd (Murchison) has announced that it will sell all of its interests in Crosslands Resources Ltd and the Oakajee Port and Rail (OPR) project to Mitsubishi Development Pty Ltd, a subsidiary of Japan's Mitsubishi Corporation (Mitsubishi), for a cash consideration of A$325 million.
After the transaction is completed, Murchison will have no requirement to continue funding ongoing development of the projects; however, it has agreed to continue funding Crosslands and OPR to completion and support interim budgets for the period between January 1, 2012 and March 31, 2012.
According to the Murchison statement, the sale transaction is subject to approval by Murchison shareholders. After the approval of the shareholders expected in February 2012, the sales transaction is scheduled to be completed in March 2012.
Murchison also stated that it will use the funds gained from the transaction to pay all outstanding debts, costs of the transaction and other obligations.