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PERTH (miningweekly.com) – ASX-listed copper cathode producer Tiger Resources would spend $111-million to require the remaining 40% interest in its flagship Kipoi project, in the Democratic Republic of Congo (DRC).
Tiger currently holds a 60% interest in the holding company of the Kipoi project, Societe d’Exploitation de Kipoi SA (SEK).
Under the terms of the transaction, Tiger would require the balance of the project in exchange for $111-million, of which a $6.5-million deposit had already been paid, and the balance was due by November 10.
Post completion of the transaction, Tiger would cede a 5% interest in SEK to the DRC government, to bring the mining title in alignment to the current mining law and regulation in that country.
“Kipoi has been the cornerstone of our business over the past seven years, and together with our DRC business partner, we are proud of our achievements,” said Tiger MD Brad Marwood.
The Kipoi project recently achieved commercial copper cathode production at its Stage 2 solvent extraction and electrowinning (SX-EW) plant. The plant was expected to produce about 14 000 t of copper cathode in this calendar year, and a further 25 000 t of cathode in the first full 12 months of production.
Marwood noted that the company had identified a potential growth area for Tiger by focusing on near-mine exploration and sourcing plant feed from elsewhere in the Kipoi region, ensuring the mine would operate well into the next decade.
“We believe the acquisition of the additional 40% interest in SEK to be earning-accretive and [it] offers the opportunity to grow our business and cement our future in the DRC as a 50 000 t/y copper cathode producer once the proposed expansion of the SX-EW facility has been completed.”
To fund the acquisition, Tiger would raise about $19-million through a share placement, a further $53.9-million in a fully-underwritten pro-rata accelerated non-renounceable entitlement offer, and a finance facility worth $100-million.
The equity raising would see Tiger issue 65-million shares, at a price of 30c each to raise the funds, while the entitlement issue would allow eligible shareholders to subscribe for one new share, for every five held. The entitlement offer would also be priced at 30c a share.
Tiger told shareholders that the offer price represented a discount of 2.9% to the company’s 30-day volume weighted average price.
Meanwhile, Tiger had also executed a finance facility with Taurus Mining Finance Fund. The six-month, $100-million facility would have an interest rate of 11% a year.