2nd Dec 2024 08:59
(Alliance News) - Philippines-focused mineral resources firm Metals Exploration PLC on Monday said it is sizing up a takeover offer for fellow London listing Condor Gold PLC.
Metals Exploration, which is backed by property financier Nick Candy, said it is "in advanced-stage discussions" with the board of Condor, the company developing the La India gold project in Nicaragua. Metals Exploration owns the Runruno gold project in northern Philippines.
Condor Gold is backed by Jim Mellon, a well-known London stock market investor.
"There can be no certainty that any firm offer will ultimately be made, nor as to the terms on which any offer might be made," Metals Exploration said.
In a statement on Sunday, Condor said it received two non-binding offers, one from Metals Exploration and another from Toronto-listed Calibre Mining Corp. The terms of either offer were not disclosed.
Calibre on Monday, however, said it does not plan to make an offer for Condor.
"Condor initiated the sale process for their La India gold asset two years ago. During this time, Calibre acknowledges having engaged in discussions with Condor regarding the potential acquisition of the La India gold asset, which aligns well within Calibre's Hub & Spoke operation. However, Calibre confirms that it is not currently in discussions with Condor, nor does it have an active offer," it explained.
Sky News on Sunday said the Metals Exploration proposal is in cash and shares. It would create an enlarged firm worth about GBP150 million.
On Monday, shares in Condor Gold were up 26% to 30.13 pence each in London, giving it a market value of GBP59.0 million. Earlier Monday, the stock set a new 52-week high of 37.00p. Metals Exploration traded 7.0% lower at 5.30p for a market capitalisation of GBP92.1 million.
Sky News said Metals Exploration, 35% owned by Candy, had secured irrevocable undertakings from a number of Condor Gold investors in recent days to vote in favour of the proposed deal.
Metals Exploration on Monday announced it entered into an unsecured bridging term loan facility worth GBP5.5 million with Drachs Investments No 3 Ltd. The financing is in connection with its possible Condor buy. It carries a 10% annual interest rate. Metals Exploration noted Drachs owns just over 18% of its shares.
Condor Gold on Monday said it has entered into an unsecured term loan facility with Galloway Ltd for up to GBP475,000.
Galloway Ltd is owned by Burnbrae Group Ltd which is, in turn, wholly owned by Jim Mellon, Condor's chair. Galloway Ltd owns just over 26% of Condor Gold.
Around GBP200,000 of the loan facility is available from November 4 and GBP275,000 available from Monday. Any amount of the facility not drawn down by the end of the year will automatically be cancelled.
Proceeds are for general working capital purposes.
By Jeremy Cutler, Alliance News reporter
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