On 10 November 2016, GrowMax accepted an offer from Energy Operations Argentina LLC (EOA) – a private American company – for the sale of all of the issued and outstanding common shares of Energicon. The transaction closed on 24 November that year.
Under the terms of the offer and share purchase and sale agreement, the total cash consideration payable by EOA was US$5.1 million. Of this, US$3 million was contingent upon the issuance to Energicon of a hydrocarbon exploitation concession for Vaca Mahuida prior to a prescribed date.
In its latest statement, GrowMax also announced that, pursuant to Decree 1481 dated 9 October 2017 and published in the Official Gazette on 23 October 2017, the Governor of the Province of Rio Negro has approved the granting of the Vaca Mahuida Exploitation Concession to Energicon and its joint venture partner. Accordingly, the contingent US$3 million is now payable by EOA to the company in three equal tranches over the coming 13 months. This is an additional payment further to the US$1.35 million that is currently outstanding from EOA to the company.
Stephen Keith, GrowMax Resource’s President and CEO, said: “This is a positive step for GrowMax Resources, adding more working capital to its balance sheet. Upon receipt, these payments will cover a significant portion of the company’s general and administrative costs for 2018. Furthermore, this allows the company to focus its attention on its core assets and increasing value for its shareholders.”