PERTH (miningweekly.com) – ASX-listed Straits Resources, which would separate its coal and metals assets, announced on Thursday that joint-venture (JV) partner PTT Mining (PTTML) would buy its coal business.
Straits would demerge its coal and metals businesses, with the metals and associated businesses being transferred to a new entity and the coal business remaining in Straits.
PTTML, a Thai mining conglomerate, would pay A$1,72 a share in cash for every Straits share held, to acquire the south-east Asia coal assets.
The acquisition valued Strait’s 40% interest in its coal JV vehicle with PTTML, PTT Asia Pacific Mining, at around A$50-million.
“This transaction is a significant event for us and our shareholders. It crystallises the value of our more mature coal business which Straits has built over a long period of time,” said company chairperson Alan Good.
The acquisition scheme would be separate to the demerger, which was announced in September, and would only proceed in the demerger scheme was approved by shareholders and the court.
Strait’s coal business includes an effective 18,24% interest in Straits Asia Resources, and a 40% interest in PTT Asia Pacific Mining, which holds an interest in the Brunei coal project and the Madagascar coal project.
“In addition, through the demerger, we are creating for Straits shareholders an exciting new copper-focused metals business that would give them the opportunity to participate in future value creation,” said Good.
The acquisition scheme with PTTML would not affect Straits' shareholders right to receive one share in the newly formed MetalsCo, for every Straits share held, the company reported.
If the planned demerger was implemented, MetalsCo would hold all the metals and associated businesses that were currently held by Straits. This would include a copper project in New South Wales, and gold projects in New South Wales and Indonesia.
It would also include a 71% interest in TSX-listed Goldminco, exploration projects in South Australia, as well as other associated assets.
“MetalsCo will be a copper-focused pure-metals company with the potential to become a significant player in the Australian copper industry,” said Straits CEO Milan Jerkovic.
“Our producing assets, the Triton copper mine, and the Mount Muro gold mine provide a base to advance an attractive portfolio of exploration assets. We are confident that we can grow MetalsCo into a significant copper/gold producer over the medium- to long-term and look forward to retaining the support of existing shareholders.”
The Straits board has reported that it considered the demerger scheme and the acquisition scheme to be in the best interest of shareholders, and recommended that shareholders vote in favour of these.
The acquisition scheme was subject to various conditions, including regulatory approval, court approval, as well as bank approval from the Bank of Thailand to remit foreign currency to PTTML to pay the acquisition scheme consideration.
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