PERTH (miningweekly.com) – ASX-listed MetroCoal has made strides in its takeover of fellow-listed Cape Alumina, after major shareholder China Xinfa Group Corporation accepted MetroCoal’s offer for its 12.1% shareholding.
MetroCoal’s total shareholding in Cape Alumina now exceeded 90%, and the company said on Monday that it would proceed to launch a compulsory acquisition of the remaining shares.
Under its current takeover target, MetroCoal is offering Cape Alumina shareholders one of its own shares for every 1.3 Cape Alumina shares held.
MetroCoal said the takeover was in the best interest of all shareholders, as it allowed the company to focus its resources on the development of the Bauxite Hills project, and to realise the benefits and savings available to the merged entity.
A prefeasibility study previously conducted by Cape Alumina has found that the Bauxite Hills mine could deliver five-million tonnes a year, over a ten-year life. The study proposed that the Bauxite Hills mine would start production at 2.5-million tonnes a year of dry beneficiated bauxite, building to full capacity over a two-year period.
Capital costs for the project have been estimated at between A$234-million and A$250-million, depending on the time and development option chosen for the Bauxite Hills project, with operating costs estimated at between A$24/t and A$27/t.
MetroCoal said that the market outlook for bauxite remained positive, reflecting strong demand in the sector and the supply constraints resulting from Indonesia’s ban on exports, which was introduced in January this year.