Anglesey Mining has entered into agreements giving it the right to acquire a controlling interest in the Grangesberg iron project in Sweden.

The Grangesberg iron ore mine is situated in the mineral-rich Bergslagen district of central Swedenabout 200 kilometres north-west of Stockholm.

Until its closure in 1989 due to prevailing market conditions, the Grangesberg mine was the third largest iron ore mine in Sweden, next only to the Kiruna and Malmberget mines in the north of Sweden, with in excess of 150 million tonnes of iron ore mined down to around 500 metres deep.

Prior indications are that at least 115 million tonnes of iron ore containing around 40% iron remain for exploitation at Grängesberg. The homogenous iron ore body in Grängesberg is of significant size and of the Kiruna geological type, making it well suited for cost-effective production of attractive iron ore products.

Anglesey has purchased for US$145,000 a direct 6% interest in Grangesberg Iron AB, a private Swedish company that was founded in 2007 with the target of re-opening the historic iron ore mine in Grangesberg and which, in conjunction with the Anglesey investment and with Anglesey assistance, has recently completed a financial and capital restructuring.

GIAB holds a 25 year exploitation permit covering the previously mined Grangesberg underground mining operations granted by the Swedish Mining Inspectorate in May 2013.

At the same time Anglesey has negotiated a 12 month evaluation option to acquire 51% of the enlarged share capital of GIAB for the issue of new ordinary shares of Anglesey.

Anglesey has also entered into shareholder and cooperation agreements such that during the term of the option Anglesey holds management control and operatorship of GIAB and will appoint three out of five directors to the board of GIAB including the Chairman.

The remaining 43% of GIAB is held by Roslagen Resources AB, a Swedish private company, which has led the re-development of the Grangesberg iron project since 2007. Roslagen will appoint two directors to the board of GIAB and provide experienced local executive management.

As part of the agreements and reorganisation an outstanding loan in GIAB in the principal amount of US$3.5 million due to KII Holdings Limited, a Cypriot company has been renegotiated and is now repayable by the end of 2016.

At the same time, Eurang Limited, a UK private company, has agreed to invest $1.75 million, of which $1.25 million has been invested in GIAB, for new shares representing the 51% shareholding interest in GIAB.

This has been carried out through a new wholly owned special purpose Swedish company, Eurmag AB over which, during the term of the option, Anglesey will hold management and control rights. The additional $500,000 will be used to cover transaction costs and expenses and certain outstanding liabilities.

Upon the exercise of the option, which will be entirely at Anglesey's discretion, Anglesey will acquire all of the shares of Eurang Limited by the issue of new shares of Anglesey to the value of $1.75 million, to be priced at the average of the Anglesey share price at the date of option (3.375p) and the 20 day average share price prior to date of exercise, (but at no lower than 3.375p), and thereby acquire direct ownership and control of the 51% shareholding in GIAB, and thus increase Anglesey's direct interest in GIAB to 57%.