Arehada Provides Updates on Sale of Subsidiary
TORONTO, ONTARIO, Arehada Mining Limited today provides an update on the proposed sale by its wholly-owned subsidiary Arehada (Barbados) Corporation (“ABC”) to Shanjin Mining Corporation (“Shanjin”), a Shandong based Chinese mining company. Pursuant to the agreement between ABC and Shanjin, ABC agrees to transfer all of the issued and outstanding common shares of Arehada Mining Corporation (“Arehada China”) held by it to Shanjin. Arehada China is the Chinese operating subsidiary of Arehada.
The Company understands that at this stage two steps remain to be completed before the sale can close. One is the review by the Tax Bureau of Xilinguole Meng of the Inner Mongolia Autonomous Region (the “Tax Bureau”) of the audit reports (including the recently filed supplementary report) and the independent valuation report to ensure they are in compliance with tax laws and other legal requirements in China. The Tax Bureau may request an adjustment of the sale price and determine the applicable tax rate for the sale proceeds in accordance with the Accounting Standards for Business Enterprises and tax laws in China. The Company expects it may take up to two months to obtain the Tax Payment Certificate from the Tax Bureau upon its completion of the review, after which it can then apply to the Foreign Exchange Administration Bureau of Xilinguole Meng of the Inner Mongolia Autonomous Region for foreign exchange modification registration and other related matters.
The above contains forward looking information that is subject to a number of known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those anticipated in our forward looking statements. Factors that could cause such differences include: changes in world commodity markets, costs and supply of materials relevant to the mining industry, extent of resources actually contained in mineral deposits, actual recoveries achieved in processing ore, technological change, change to regulations affecting the mining industry, risks associated with mining operations in China, environmental and safety regulations risks, and risk associated with failure to obtain required regulatory or third party consent. Generally, forward looking information can be identified by the use of forward looking terminology such as “plans”, “expects”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might”, or “will be taken”, “occur”, or “be achieved”. Forward-looking information in this release include statements regarding the Company’s proposed sale to Shanjin Mining Corporation, the effectiveness of the purchase agreement between Arehada (Barbados) Corporation and Shanjin Mining Corporation, and the fulfillment of the conditions set out in the purchase agreement. Although we believe the expectations reflected in our forward looking information are reasonable, results may vary, and we cannot guarantee future results, levels of activity, performance or achievements. Readers should not place undue reliance on forward looking information.