On 1 January 2019, Cobalt 27 Capital Corp. (Cobalt 27) entered into a definitive scheme implementation agreement with Highlands Pacific Limited (Highlands), pursuant to which Cobalt 27 will acquire all of the issued ordinary shares of Highlands that it does not own by means of a scheme of arrangement under Part XVI of the PNG Companies Act in Papua New Guinea (PNG).
Anthony Milewski, Chairman and CEO of Cobalt 27, stated: "The acquisition of Highlands will allow Cobalt 27 to gain a direct interest in the Ramu nickel-cobalt mine and materially increase its attributable exposure to the mine’s nickel production from 27.5% to 100% and cobalt production from 55% to 100%, relative to the previously announced Ramu Cobalt Nickel Stream. It does so at nearly half the cost of the previously announced Ramu Cobalt Nickel Stream, provides increased balance sheet flexibility and enhances value for Cobalt 27 shareholders. It also brings cash flow to our business, something we have told our shareholders was important from the beginning."
Highlands’ key asset is its 8.56% interest in the Ramu nickel-cobalt mine (Ramu) located near Madang on the north coast of PNG.
Following the repayment of Highlands’ attributable Ramu construction and development loans, Highlands’ ownership would increase to 11.3%. Ramu is majority-owned and operated by Metallurgical Corporation of China Ltd (MCC) which holds a 67.02% stake in MCC-JJ Mining which owns 100% of MCC Ramu NiCo Ltd. (MCC – Ramu), holder of an 85% joint venture interest in Ramu. The Government of PNG and local landowners (the PNG stakeholders) own a 6.44% stake in Ramu, which would increase to 8.7% upon repayment of construction and development loans. The Ramu mine was financed and constructed by MCC for US$2.1 billion which, at the time, was China’s largest overseas mining investment. MCC is listed on the Hong Kong Stock Exchange and Shanghai Stock Exchange with a market capitalisation of approximately US$9 billion.
Read the article online at: https://www.globalminingreview.com/finance-business/03012019/cobalt-27-completes-friendly-acquisition-of-highlands-pacific/