Kingking buyer to hasten payment

MANILA, Philippines - Benguet Corp. (BC) disclosed yesterday that it has agreed with St. Augustine Mining Ltd. (SAML), an affiliate of Russell Mining & Minerals lnc. (RMMI), to accelerate the payment of the acquisition price of the Kingking project and related claims.

In a disclosure to the Philippine Stock Exchange (PSE), Benguet said the two companies have agreed on a discounted payment for the balance which in the original agreement has to be paid over a period of seven seven years.

As previously disclosed, the original agreement provides a total consideration amount of $25 million out of which, an initial payment of $8 million was made by SAML on Oct. 22,2010.

lt is only upon full payment of the price that the transfer of Benguet’s interest in the properties becomes effective.

Benguet is selling its mining right in the Kingking mine, the mineral processing and sharing agreement (MPSA) of which is owned by the National Development Corp.

The Kingking mine is located in Compostela Valley in Mindanao.

With its deal with SAML, Benguet would be able to extinguish up to 90 percent of its P1.2-billion debt to its creditors through a buyback/offsetting arrangement.

SAML would pay Benguet $25 million – a portion of which Benguet would use to buyback/offset about 90 percent of its outstanding debt papers.