Kastan announced that the Company has entered into a development agreement with the LIBO Group a privately held Chinese manufacturing company.Under the terms of the agreement,Kastan and LIBO will install a copper leaching plant in Tanzania and establish a joint venture to specialize in processing copper ore into higher value added copper products targeted for the export market.
LIBO will acquire a majority ownership position in Kastan Industries Limited,which is currently a Kastan wholly owned subsidiary.The company will be renamed as LIBO-Kastan Industries Limited and is expected to begin operations in the Second Quarter of 2013.As part of the agreement between Kastan and LIBO the LIBO Group has established a Research and Development Center at its corporate headquarters to ensure environmentally responsible,best-in-class processing procedures are employed in the Tanzanian production facilities.The transfer of technology to Tanzania will be supported by an extensive training program for local staff which will enable them to operate the facilities to world-class standards.
Mr John Tate CEO of Kastan remarked that"We are excited about the relationship we are establishing with the LIBO Group.Charles,LIBO's President and I have been working on this project since early 2012 and are both convinced the opportunities present for our companies to launch upstream copper processing and manufacturing activities in Tanzania are credible.Many challenges remain ahead of us as we launch this initiative,however,we are convinced that keeping as much of the copper value chain in Tanzania as possible is a long term strategy that will unlock enormous value for all stakeholders."
LIBO Group president,Mr Yuefeng(Charles)Luo continued that"Over the last 3 years I have been evaluating business opportunities in Southern and Eastern Africa in an effort to establish LIBO's footprint on the continent.We believe that Tanzania,with its strategic location and extensive natural and human resources represents a preferred investment destination for us.John and I have spent considerable time in developing what we believe is a workable business model that is a win-win for all stakeholders and that will enable us to grow aggressively with the Tanzania copper industry over the coming years.We look forward to joining hands with Kastan to launch this important initiative."
