Iamgold Corp said it has agreed to sell its interests in Omai Bauxite Mining Inc and Omai Services Inc to Bosai Minerals Group Ltd for US$46 million.
The deal also include US$18 million in third-party debt.
The deal, part of a process of disposing of non-core assets prior to its merger with fellow Canadian miner Cambior Inc, will be finalised on December 31, 2006.
Following a review of the assets by Bosai Minerals, Iamgold will receive approximately US$28 million in cash, subject to working capital and other adjustments.
Joseph Conway, president and chief executive of Iamgold said: “We are pleased to have reached an agreement for the sale of the bauxite assets.
“The transaction is consistent with our strategy to focus on our core assets. We look forward to working with Bosai Minerals to finalise this transaction.”
Yuan Zhilun, managing director of Bosai Minerals Group, added: “The Guyana bauxite deposit is well known to the industrial minerals industry as a first-class material and Bosai Minerals is pleased to carry on the tradition.”
Last month, Iamgold agreed to a planned merger with Cambior in an all-share deal worth C$1.17 billion.
After the deal, current shareholders will own approximately 57% of the company, with Cambior shareholders the remaining 43%.
The combined company, to be called Iamgold Inc, will have an output of over 1 Moz/y and become the world`s tenth-largest gold producer.