17th Sep 2013 09:14
LONDON (Alliance News) - African Mining & Exploration PLC Tuesday said it would take more convertible loan notes and fewer shares in Alecto Minerals as part of that company's acquisition of its West Africa subsidiary, in order to make sure it doesn't get a big enough stake that forces it to make a takeover bid for Alecto.
African Mining said it would now subscribe for GBP350 million convertible loan notes from Alecto, up from GBP250,000 previously, but would only subscribe for GBP150,000 Alecto shares, down from GBP250,000 previously.
That will ensure that its stake in Alecto following the transfer of African Mining & Exploration West Africa stays below 30%, including the stakes of parties deemed to be acting in concert with Africa Mining.
After Alecto's acquisition, African Minerals will hold a 24.9% stake in the company, it said in a statement. It has undertaken not to convert the convertible loan notes to the extent that conversion would trigger the obligation to make a mandatory offer for Alecto.
Alecto is paying GBP1.25 million for African Mining's West African unit by issuing shares and convertible loan notes. However, under UK takeover rules, African Mining would have to make a takeover offer for Alecto if its stake rises above 30%.
Alecto Minerals Tuesday published a circular and a notice of a general meeting in relation to its proposed acquisition.
African Mining shares were up 2.2% at 3.45 pence Tuesday morning.
By Steve McGrath; [email protected]; @SteveMcGrath1
Copyright 2013 Alliance News Limited. All Rights Reserved.
Related Shares:
ALO.L