Up for divestment are the company's foundation CSG projects - its 74% interest in the Mopane, Springbok Flats and Springbok Flats West projects - and its primarily focus for the past few years, the potentially lucrative 76% interest in the offshore Ibhubesi gas project with PetroSA (24%).
The sale, to Black Empowerment Entity and major shareholder Umbono Capital which controls the Sunbird board, has a total transaction value of some $8.5 million, and is designed to leave a shell company with $1 million cash that can be recapitalised.
Some 55 million existing Sunbird shares held by parties associated with Umbono, some 40% of Sunbird's issued paper, will be cancelled.
It will also include the assignment of all Sunbird's outstanding debt to the BEE company, around $4.8 million.
Sunbird directors Kerwin Rana and Dorian Wrigley, who are also directors of Umbono, will resign from Sunbird on completion of the deal, assuming shareholder support at a meeting to be held in May.
An independent report is being prepared for shareholders.
Sunbird - which lost founding directors Will Barker and Andrew Leibovitch last year after a behind the scenes battle for control between major shareholders Salt Mineral investments and Umbono - tried to sell itself last year to Glendal Power & Industries at $0.18 per share, but the critical financial status of both the seller and the buyer undid that proposal.
The company looked at a Johannesburg Stock Exchange listing as a result, to strengthen its links with the energy poor South African markets.
The junior was seeking to develop the offshore Ibhubesi field in South Africa, and has a terms sheet with South African energy retailer Eskom for the supply of 30 billion cubic feet of gas per year for up to 15 years to the 1350 megawatt Ankerlig power station.
At one stage it had a staged transaction with African investment company Vandasia Investments to fund its Ibhubesi gas project in South Africa through to completion.
Ibhubesi has the country's largest undeveloped gas reserves, 540Bcf (2P) and exploration upside to a further 7.8 trillion cubic feet.
It also has the surrounding 5,000sq.km of exploration potential in the Orange Basin plus its CSG permits.
West Perth-based Cygnet Capital has been engaged to assist with identification and introduction of new business opportunities.
Sunbird shares last traded on April 13 at $0.049, about 10% of the peak they hit in December 2013 when it secured its first memorandum of understanding with Eskom, 12 months after securing the field from Pioneer Natural Resources.
