Pan Asia signs restructuring MoA with Ranrich

By Demas Simbolon

Australia-listed firm Pan Asia Corporation Ltd announced the signing of Memorandum of Agreement (MoA) with Ranrich Investments Limited (RRI) on Wednesday regarding Pan Asia Corporation's restructuring.

Mentioned within the MoA is the agreed repayment to Pan Asia at the outstanding amount of US$4.5 million on or before March 14, 2012 by Ranrich, in which Pan Asia will also be allowed to exchange its right to earn a 50 percent interest in Baramega Citra Kutim Permai (BCKP) for a royalty of US$1 per tonne on all coal sold from the BCKP IUP, limited to a total of US$15m.

Another highlight of the agreement is the resignation of Honardy Boentario from the position of director, tendered by Wednesday March 7, 2012.

"This restructuring of the initial Ranrich arrangements strengthens our near term cash position and allows us to focus on our flagship TCM project which continues to shape up well," said Pan Asia CEO Alan Hopkins.

Ranrich has undertaken to deliver its current outstanding contracted shipments of 220,000 tons of coal to Pan Asia's designated buyer.

Ranrich Investments Limited and Innovation West Pty Ltd (a company wholly owned by Pan Asia Corporation Limited) originally entered into a Memorandum of Agreement in 2010 for the financing of/and investment in various coal projects. The repayment of the finance was based on RRI making contracted coal shipments to a designated buyer arranged by Innovation West Pty Ltd.

Since entering into the original financing arrangement, RRI has struggled to provide the scheduled coal deliveries, as a result, Pan Asia has now sought to have the principal monies outstanding under the contract repaid.

Editing by Audy Zandri