Post by
Sogosohubidu201 on Feb 13, 2020 3:04pm
$250 m Acquisition land rights from Gécamines not paid yet
(Acquisition of land rights from Gcamines
As previously announced, KCC entered into an agreement with Gcamines on December 19, 2019 to acquire from Gcamines a comprehensive land package covering areas adjacent to KCC’s existing mining concessions for $250 million none of which has been paid as at February 13, 2020. The land includes multiple blocks for construction of a new long-term tailings facility and the possible exploitation of additional resources that will enhance KCC’s ability to more efficiently operate its mines, facilities and other key infrastructure requirements. The agreement provides for an initial payment of $150 million. Since it has been agreed between KCC and Gcamines that the initial payment shall be postponed, the agreement has been treated as an executory contract and the commitments of $250 million have been disclosed as capital commitments.)
The $250 m expense of land rights acquisition may likely be treated as capital investment, which will not affect earning and operational cash flow, but will affect free cash flow this year.