Mining and Minerals Industries Holding Pte. Ltd. (MMIH) has announced that it has entered into a sale and purchase agreement (SPA) with AsiaPhos Ltd, for AsiaPhos to acquire the entire issued and paid-up share capital (the sale shares) of MMJV Pte. Ltd (the target company) as per the terms and conditions of the SPA (the proposed acquisition).
The proposed acquisition of the target company, and together with its subsidiaries and associate companies (the target group), will constitute a reverse takeover of AsiaPhos (RTO). The target group is a Singapore-led gold and copper mining group of companies, which hold controlling interests in three gold and copper concessions in the Republic of the Philippines.
Vijay Kamath, CFO of MMIH, commented: “This has been a culmination of a year-long effort to offer investors the opportunity to participate in the first copper-gold listed company on the SGX [Singapore Exchange]. We have projects at different life cycles that we can develop using the funds raised from our listing. Our Mankayan Project can be brought closer to mining feasibility, while we can advance the exploration of our Mainit Project which has interesting prospects. Similarly, we can explore our Semco Gold & Copper Project further, while leveraging on the royalties received from the small-scale miners working on site for operational cashflow.”
The purchase consideration
The purchase consideration for the sale shares is S$72 million or 50% of the valuation of the target group, whichever is the lower (the purchase consideration) as was mutually agreed by the parties and based on the valuation set out in the Independent Valuation Repor and excluding any convertible or exchangeable debentures of the target group which will be discharged at completion (the agreed valuation).
AsiaPhos will satisfy the purchase consideration with the allotment and issue of new shares (consideration shares) to MMIH at an issue price of S$0.005 per consideration share (the pre-consolidation issue price), which was determined based on, among other things, the parties’ perceived value of AsiaPhos of S$8 million on a willing-buyer, willing seller basis, inclusive of outstanding debts and liabilities owed by AsiaPhos to its Executive Director, Dr Ong Hian Eng, and a subsidiary, Norwest Chemicals Pte. Ltd and no other actual or contingent liabilities outstanding from AsiaPhos on completion. The pre-consolidation issue price of S$0.005 represents a discount of approximately 64% from the weighted average trading price of AsiaPhos’ shares of S$0.014 on 11 November 2020.
The abovementioned sale and purchase of the sale shares is conditional upon the satisfaction of conditions precedent in the SPA on or before the date falling one year from the date of the SPA or any such other date to be mutually agreed, or such a date falling three months from the date on which a proposed whitewash resolution is approved, whichever is earlier (the long stop date).
The proposed acquisition is also contingent upon, among other things, obtaining the necessary approvals from AsiaPhos’ shareholders and relevant regulatory authorities, as well as the raising of further capital (whether as debt or equity) by the target group, and setting aside at least S$2.8 million of such proceeds for the purpose of discharging the outstanding debts owed by the AsiaPhos to its Executive Director, Dr. Ong Hian Eng, and a subsidiary, Norwest Chemicals Pte. Ltd.
The target group’s mining concessions
The target group has controlling interests in the following three gold and copper mining concessions in the Republic of the Philippines:
1. Mankayan Project
The 534 ha. Mankayan Project is located in Northern Luzon, about 260 km from Manila, Philippines, and close to the centre of Mankayan mineral district where large copper deposits have been discovered. The Mankayan Project is a porphyry copper-gold deposit with over 55 000 m of drill holes and a combined mineral resource of 257.8 million y containing 9.6 million oz of gold equivalent. It has indicated mineral resource of 221.6 million t at 0.49% copper (Cu), and 0.52 g/t gold (Au) and inferred mineral resource of 36.2 million t at 0.44% Cu, and 0.48 g/t Au JORC 2004 compliant being upgraded to JORC 2012.
2. Mainit Gold Project
The 761 ha. Mainit Gold Project is located in the central part of Mindanao Island, Philippines, approximately 30 km northeast of lligan City in a geographically-favourable zone where Tampakan Copper Project is situated. The Mainit Gold Project is an epithermal gold vein deposit with bulk porphyry copper at depth and has over 6000 m of drill holes. It has an inferred mineral resource of 720 000 t at 2 g/t Au resulting in about 46 000 oz of Au.
3. Semco Gold & Copper Project
The 4395 ha. Semco Gold & Copper Project is within the Surigao - Agusan mineral district of Mindanao Island, which is host to several known epithermal and porphyry Cu and Au deposits such as the Siana Gold Mine of Greenstone Resources Corp. with a resource of >5 2 million oz and the Boyungan Cu-Au Deposit of Silangan Mining Corporation with a resource of >300 million t at 0.6% Cu and 0.6 Au g/t. The Semco Gold & Copper Project has epithermal gold veining and porphyry copper-gold and with regional mapping, soil sampling, petrography, IP geophysical survey and 3000 m of diamond drilling already done. There are 25 small scale miners operating on site with different royalty agreements who need Semco’s approval to become legal miners on its Tenement. Semco Gold & Copper Project is in a proven gold district with historical production and identified potential ore sources and has strong local community support.
Read the article online at: https://www.globalminingreview.com/finance-business/13112020/mmih-signs-agreement-for-reverse-takeover-of-asiaphos-ltd/