Mubasher: UK-based Rio Tinto on Monday announced plans to sell its stake in Namibian uranium mine Rössing Uranium Ltd to a Chinese buyer.

The mining giant’s stake of 68.62% will be sold for around $106.5 million, Rio Tinto said, noting that that buyer is China National Uranium Corp (CNUC).

The deal still has to be approved by the Namibian Competition Commission, the firm said, forecasting that the transaction would be completed sometime in the first half of 2019.

The stake sale “represents the culmination of an extensive assessment of strategic options considered by Rio Tinto in relation to Rössing,” Rio Tinto said in a statement.

Under the deal, the London-based miner will receive an initial cash payment of $6.5 million and a contingent payment of up to $100 million.

“The contingent payment is linked to uranium spot prices and Rössing's net income during the next seven calendar years. In addition, Rio Tinto will receive a cash payment if CNUC sells the Zelda 20 Mineral Deposit during a restricted period following completion,” the company stated.

Rio Tinto further added that the total consideration was capped at $106.5 million.

"The sale of our interest in Rössing once again demonstrates our commitment to strengthening our portfolio and focusing on our core assets, which deliver sector leading returns in the short, medium, and long term,” commented Rio Tinto CEO J-S Jacques.