Concerns Raised by International Investors Over Tulkubash and Kyzyltash Sale

International Investors React to Mining Asset Sale

A recently formed group of international investors in the Kyrgyz Republic has issued a statement expressing discontent regarding the recent transaction involving Chaarat Gold Holdings Limited. This statement comes on the heels of Chaarat's announcement to divest its interests in mining assets located at Tulkubash and Kyzyltash to Silvercorp Metals Inc. through the sale of its shareholding in Chaarat ZAAV CJSC.

The group, which has stakes in the aforementioned assets, raised concerns about how Chaarat managed its assets leading up to the sale. They feel that the actions taken by Chaarat raise significant questions about the due diligence conducted and the strategic decisions made that culminated in this sale. These investors have expressed a commitment to protecting their interests and are prepared to pursue any necessary measures to ensure this.

In light of these developments, the group encourages other stakeholders as well as fellow investors in Tulkubash, Kyzyltash, or Chaarat to reach out for further clarification and guidance. Their legal advisory team, Cleary Gottlieb Steen & Hamilton LLP, is available to provide more information to those impacted by this situation.

Chaarat’s divestment to Silvercorp has not only caused concern among existing investors but has also raised broader implications for the mining sector in the Kyrgyz Republic. As such, the group believes that transparency and clarity in corporate governance practices are crucial for fostering investor confidence.

The implications of this sale extend beyond immediate financial aspects, potentially influencing the operational and environmental standards upheld in the region's mining activities. Investors fear that a shift in ownership could lead to changes in practices and policies that scramble the existing agreements and operational standards that have been in place under Chaarat.

The Kyrgyz Republic has seen a surge in foreign investments lately, largely due to its untapped natural resources. However, concerns such as these can deter potential investors who might view the market as turbulent or less predictable. For the nation's economy, which heavily relies on mining, maintaining a stable, reliable investment climate is paramount.

The group asserts that they will remain vigilant in their monitoring of ongoing developments related to the sale, ensuring that their interests entwined with the Tulkubash and Kyzyltash assets are safeguarded. They are keenly aware that proactive measures may be necessary to navigate the evolving landscape in this sector and will utilize all available resources to secure their stake going forward.

To further solidify their commitment to transparency and accountability, the group emphasizes the importance of open communication amongst all stakeholders involved. With the mining industry facing increasing scrutiny regarding its environmental and social responsibilities, fostering dialogue between investors, management, and local communities becomes ever more critical.

As the situation continues to develop, it will be crucial for all parties involved to remain engaged, not only for the health of their investments but also for the integrity and sustainability of mining operations in the Kyrgyz Republic. The coming weeks and months will undoubtedly reveal further responses from Chaarat, Silvercorp, and the involved investors as they navigate the next stages of this transaction.