Elcora Resources has signed a deal to purchase 40% stake in Sakura Graphite of Sri Lanka which operates the Sakura Graphite Mine.
As part of the transaction, Elcora will receive 20% of the net income from the Mine as the Mine operator, and an additional 30% net income from the Mine for managing the processing of the graphite.
Operated between 1974 and 1985, the Mine produced around 18,000 tons of graphite per year.
Sakura has invested in the mine over the last three and upgrading of the remaining equipment will continue and Elcora will provide the capital expenditure required to put the mine into commercial production.
KWA Holdings will hold the remaining 60% share of Sakura.
Elcora president and CEO Troy Grant will assume the role of president and CEO of Sakura, while CFO Theo van der Linde will become the CFO of Sakura.
The transaction is subject to consent from the TSX Venture Exchange, regulatory and Elcora’s shareholder approvals, if required.