finance
Africa Metallic Resources Secures U.S. Sanctions Clearance for Liberia Iron Ore Deal
Africa Metallic Resources has received clearance from the U.S. Office of Foreign Assets Control to acquire the Putu Iron Ore concession from Severstal. The approval removes a key regulatory barrier in the transaction.
May 19, 7:26 AM·1m read1 source
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U.S. Office of Foreign Assets Control to proceed with the acquisition of the Putu Iron Ore concession from Severstal. Multiple sources familiar with the negotiations told the Daily Observer that the clearance removes one of the largest regulatory obstacles tied to Severstal's Russian ownership structure.
The Putu concession in southeastern Liberia is one of the country's largest undeveloped iron ore deposits. Development requires substantial new investment in rail, logistics, power, and export infrastructure. Africa Metallic Resources has financing support from the Africa Finance Corporation and technical partnership arrangements with international partners.
The Africa Finance Corporation maintains a strategic relationship with the United States International Development Finance Corporation.
Earlier government assessments had favored Africa Metallic Resources on strategic alignment and financing structure. 6 percent in a National Investment Commission-led evaluation. A May 7 communication from the Ministry of Mines and Energy had attempted to withdraw the government's earlier designation of Africa Metallic Resources as preferred developer.
Sources close to the negotiations said the clearance changes the assumptions behind that recommendation. "The sanctions issue was the biggest risk factor hanging over the transaction," one source familiar with the talks said. "Once that was resolved, the equation changed.
