Central Asia Metals to buy Lynx Resources for $402.5m, including Macedonia lead zinc mine Sasa
Aim-listed base metals miner Central Asia Metals will buy Bermuda-based Lynx Resources for $402.5-million.
Lynx, which is owned by Bermuda-based fund Orion Co-Investments III and Swiss private equity firm Fusion Capital, owns the SASA zinc/lead mine in Macedonia.
The mine produced 22 515 t of zinc in concentrate and 28 995 t of lead in concentrate from 783 000 t of ore in 2016.
The acquisition, which will be funded from a mix of debt and cash, is expected to be both earnings- and cash-flow-per-share-accretive in the first full year.
“We believe this transaction is an exceptional opportunity for Central Asia to acquire a high-quality asset that complements our existing business,” chairperson Nick Clarke said in a statement.
He added that the combination of Central Asia and Lynx will create a diversified, base metals producer with low-cost, long-life operations that are expected to generate positive cash flows throughout the commodity cycle.
In terms of funding, $120-million of debt has been sourced from Traxys at a rate of 4.75% plus London Interbank Offered Rate over a five-year term, while a further $67-million of existing Lynx debt has been rolled over with five years remaining.
The equity portion of the consideration includes a private placing that was launched on Friday to raise $153.5-million.
The placing is fully underwritten and the proceeds will represent 39.6% of the company’s current market capitalisation based on the closing share price on September 1, when shares were suspended.
A further $50-million will be raised by issuing shares in Central Asia to Orion through an equity subscription.
The company increased its copper production by 2% year-on-year to 7 027 t and its sales by 8% year-on-year to 6 870 t for the six months ended June 30.
Revenue increased to $38.6-million from $30.9-million the year before, delivering a 36% rise in pretax profit to $20.4-million.
Central Asia has maintained its production guidance for the full year at between 13 000 t and 14 000 t of copper.
- Terra Balcanica extends its polymetallic footprint with positive drill exploration in its flagship project in Bosnia
- St Charles Resources said it reached a final agreement to acquire Bulgaria-based private mining business Eastern Resources
- Europe, Can mining ever be green?
- Russia, Eligdar reports record gold production in 2022
- The exploitation of Portugal’s mineral resources
- Lydian, Amulsar Gold and a viable mining industry in Armenia
- GeoProMining Gold indirectly confirms its involvement in corrupt deal with Armenian government
- Jadar Lithium in Serbia gets four exploration licenses
- Conroy Gold and Anglo Asian Mining to open modern gold mine in Ireland by 2030
- Who are the main players in the ore exploration business in Serbia
- Romania bail out from Ukraine Krivoy Rog Mining Oxidized Ore project investment
- Lydian files BIT notice in relation to Armenian mining project that has been blocked
- Polish ZGH Boleslav accused of polluting Montenegro rivers from its lead zinc mine Suplja Stijena
- Lithium and rare earth elements discovered in Mongolia Khuut mine
- Polymetal takes over Armenia Kapan gold mine from Dundee