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Troubled Blumont sued by Australian miner over scrapped investment plans

Published on Dec 2, 2013 8:40 PM

Singapore-listed Blumont Group, one of a trio of penny stocks that crashed in October, is facing additional woes.

The mining group is being sued by Australian miner Prospect Resources, over its decision to terminate a deal to invest A$3.9 million ($4.5 million) in the company.

On Oct 31, Blumont announced it was scrapping the deal as it was of the view that the Australian firm could not fulfil a critical condition: that of getting the paperwork done for Prospect Resources' acquisition of two gold projects in Zimbabwe.

Blumont, along with related companies Asiasons Capital and LionGold Corp, saw a meteoric rise in its share price for the first nine months of the year before its counter plummeted in October.

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