Strike's $53m investment off the table

Negotiations between Strike Resources Ltd and major shareholder Gallagher Holdings, controlled by Russian billionaire Alisher Usmanov, over a $53 million investment have ceased, prompting Strike to abandons plans for an on-market share buy back.

In a brief statement, Strike said Gallagher will not proceed with the further investment due to continuing uncertainty in the global markets.

Last month Gallagher had pulled the pin on a second tranche of a share placement valued at $53.4 million due to the financial turmoil, but Strike said it was still in "good faith" negotiations over an alternative investment mechanism.

The $53.4 million tranche was part of an overall share placement totalling $103 million. Gallagher has already subscribed to the first tranche of shares worth $49.7 million.

Gallagher is the largest shareholder of Strike, holding a 14 per cent interest.

Additionally, Strike said it will not proceed with the share buy-back it announced last month.

"The directors have determined that it is no longer appropriate for the Company to be undertaking this buy back as a consequence of the Gallagher tranche 2 not occuring and the current turbulent market conditions," Strike said in a statement.