Dundee Precious Metals Announces Sale of Tsumeb Smelter for US$49 Million

TORONTO, March 07, 2024 (GLOBE NEWSWIRE) -- Dundee Precious Metals Inc. (TSX: DPM) (“DPM” or “the Company”) today announced that it has entered into a definitive share purchase agreement (the “SPA”) with a subsidiary of Sinomine Resource Group Co. Ltd., (“Sinomine”) for the sale of its interest in the Tsumeb smelter located in Namibia, including all associated assets and liabilities, through the disposition of all of the issued and outstanding shares it indirectly holds in Dundee Precious Metals Tsumeb Holding (Pty) Ltd. (“DPMTH”) (“the Transaction”) for consideration of US$49 million in cash.

“We are pleased to announce the sale of the Tsumeb smelter, which is consistent with our strategic objective of focusing on our gold mining assets and simplifying our portfolio going forward. We are extremely proud of the investments that we have made to transform Tsumeb’s operational and environmental performance into a specialized custom smelter with a highly skilled workforce,” said David Rae, President and Chief Executive Officer.

“We would like to thank the government of Namibia, the community of Tsumeb and our employees for their support over the past 13 years. We will work closely with Sinomine to ensure a smooth transition to support a successful future for the operation and all of its stakeholders.”

DPM acquired the smelter in 2010 to secure a processing outlet for the complex concentrate produced by the Company’s Chelopech mine in Bulgaria. With developments in the global smelting market and changes in the quality of the Chelopech concentrate, DPM is able to place its Chelopech concentrate at several other third-party facilities, providing secure and reliable processing alternatives at favourable terms.

Key terms of the transaction

Under the terms of the SPA, DPM, through the sale of the shares of DPMTH, will transfer, on a debt-free and cash-free basis, all assets and liabilities associated with the Tsumeb smelter to Sinomine for consideration of US$49 million in cash, subject to normal working capital adjustments following closing (“the purchase price”). The Company has made limited representations and warranties and provided certain indemnities to Sinomine customary with transactions of this nature, subject to a liability cap equal to 50% of the purchase price. The cash received by DPM on closing will be less a US$5 million holdback to be held in escrow for a period of six months to secure the Company’s indemnity obligations under the SPA.