PERTH (miningweekly.com) – ASX-listed Develop on Wednesday announced plans to acquire mining provider Premium Mining & Civil and Premium Mining Personnel for a total consideration of A$7.46-million.
Develop has inked a letter of intent (LoI), under which the parties have agreed to negotiate and enter into a formal share sale agreement to formalise the acquisition, which will incorporate customary terms and conditions.
The A$7.46-million, less debt, acquisition cost will be satisfied through A$300 000 in cash and the balance in Develop shares. A$3.5-million in value of the equity consideration will be subject to voluntary escrow for 12 months with the balance of the equity consideration to be subject to voluntary escrow for 24 months.
Develop told shareholders that the acquisition would bolster the company’s capabilities in providing underground expertise and equipment, both of which are in extremely high demand and will play critical roles in helping Develop achieve its goals as a mine owner/developer and mining services business partner.
The transaction is subject to shareholder approval, as well as regulatory approvals.
Develop MD Bill Beament is a minority shareholder of Premium Mining Personnel, and will receive 10% of the total consideration for the acquisition.
Meanwhile, Develop on Wednesday also reported that work had started at the Bellevue gold mine, in Western Australia, where the company was recently awarded a near A$400-million services contract for the construction, development and production activities at the underground mine.
“We have established a world-class team of highly experienced underground mining specialists. Our team includes leading managers in their respective areas and an enviable group of underground mining and maintenance personnel, backed up by the latest mobile equipment,” said Beament.
“Our people, combined with the outstanding management team at Bellevue, will ensure we maximise the huge opportunity offered by the high-grade Bellevue orebody.”
The Bellevue gold mine is expected to produce 183 000 oz/y of gold over eight years, with the project’s capital cost having been estimated at A$267-million.