It is reported that Shanghai Construction Group approved a plan by its wholly controlled subsidiary, SEFCO Group to acquire a 60% stake in Eritrean gold mining company, Zara Mining Share for USD 80 million.

SEFCO Group may make further cash payments to acquire additional mining rights from Zara Mining Share.

The target company has exploration and mining rights to an area covering 147 kilometers. Its mining rights to the Koka Gold Deposit in northern Eritrea are valid for a period of 18 years.

ENAMCO which has a 40% stake in Zara Mining Share has given its approval to the transaction. SEFCO Group will soon engage a third party to investigate the assets, liabilities and financial status of the target company.

According to Shanghai Construction, should the acquisition succeed, it will obtain stable investment returns and about CNY 1 billion worth of mine construction contracts, expanding the scale of its business in Eritea.

(Sourced from Shanghai Securities News)