East China Nonferrous Geological Exploration acquired the first Australian mining enterprises were capital platform
At 01:15 on April 13th 2011 Nanfang Wang
April 12, East China Nonferrous Geological Exploration Bureau (hereinafter referred to as "East colored") announced the acquisition of Australian GLOBE METALS & MINING (hereinafter referred to as "GBE") to obtain the latter by the shareholders will receive GBE 51% stake.
"This is a process of pain and happiness." Gone through a number of overseas acquisitions in the East China Nonferrous Secretary frustrated Shao Yi to this reporter said, although the results are gratifying, but the process is quite difficult, "may be worse then that, it will missed. "
Shao Yi said that the acquisition of GBE on the one hand access to foreign mineral resources, on the other hand, "We finally have a Geological Exploration capital operation platform, and is an international platform."
GBE 51% stake acquisition
April 12, with the GBE EGM announcement of voting results, do so holding the end of East China Nonferrous GBE, and for the first time a foreign listed mining platform.
The acquisition, east cost of 47.85 million color Australian dollar (About 310 million yuan) to buy the Australian dollar 0.405 per share, GBE 51% of the shares.
GBE major assets concentrated in Africa, including Kanyika niobium mining project, Machinga rare earth mineral projects, Salambidwe rare earth project, Livingstonia Uranium Project and the Mount Muambe Fluorite Mine project. Kanyika Nb ore project which is the company's key projects, mineral rights area of 607 square kilometers, with a total of about 60 million tons of ore resources, proved reserves of 13.2 million tons. The project put into operation in 2013, annual output of about 3,000 tons of iron niobium (in niobium metal dollars), will become the world's fourth largest producer of iron niobium.
Niobium as iron, nickel-based super alloys and zirconium-based additive, can increase its strength properties. China is the world's largest consumer of niobium, but niobium in China there is a serious shortage of primary raw material supply, greater external dependence. In addition, its prospects of rare earth project, Shao Yi, "the niobium mine project is very attractive, but the earth was more fragrance."
However, relative to resources, access to the mining financing platform GBE is more important, as the state of East China Nonferrous Geological Exploration, annual revenue size of about 10 million, belongs to junior exploration companies, Shao Yi complained about "China's domestic capital market simply unable to junior exploration companies open the door. "
GBE is the Australian Stock Exchange listed company, by holding GBE, East China Nonferrous achieved with the development strategy of overseas listed companies. Shao Yi said through GBE financing in international capital markets, will lay the foundation for the development of East China Nonferrous globalization.
The tortuous course of the acquisition of GBE
Early June 2010, East China GBE seeking informed colored external cooperation in the opportunity after the acquisition of the GBE expressed the hope that the idea of its listed companies, but GBE only willing to co-niobium mine project level, do not agree to discuss the level of mergers and acquisitions of listed companies .
"Relative to the project, I am more interested in mining platform for listed companies." As the head of the state-owned geological exploration units, Shao Yi said, "just took office four years ago, I think that the financial attributes of mineral resources is very strong, the geological survey unit of capital must be bigger and stronger fast operation. "
After some twists and turns, September 2010, GBE finally agreed to the level of mergers and acquisitions of listed companies in the program and signed letters of intent will be the East China Nonferrous 0.345 Australian dollar / share twice the price of the acquisition of a 51% stake in GBE, the same year 11 month, the two sides signed a legally binding cooperation agreement.
But in the end of January 2011, GBE colored East suddenly notice to inform the independent financial adviser on the acquisition by the assessment report concluded that "neither fair nor reasonable", and declared that it will breach of contract.
Assessment of the independent financial adviser generally "fair and reasonable", "reasonable but not fair", "fair but reasonable", "neither fair nor reasonable" conclusion 4, Yi Shao, said, "was the most unsatisfactory estimates The result is 'reasonable but not fair', and 'neither fair nor reasonable' result is no one anticipated. "
According to the assessment of independent financial advisers, GBE valuation of assets, equivalent to about twice its current price, which is 0.7 Australian dollars / share, "this basin of water poured us a real and cool."
But also good news is, GBE Chairman of the Board is still optimistic about the East China Nonferrous Mark Sumich, said the merger could be stripped of rare earth project.
"We do not agree with stripping of rare earth project, we later found, GBE Although the company niobium mine project is very attractive, but the earth was more sweet." Shao Yi introduced in the framework of maintaining the original premise of constant mergers and acquisitions, to reach a final agreement , "about a whole day, Mark Sumich return until just before the agreement."
To increase the success of the chips, to prevent regeneration of variables, Shao Yi recommended by GBE at the road show before the general meeting of shareholders to communicate with its shareholders. From March 21 onwards, accompanied by Mark Sumich was removed colored East Sydney, Melbourne, Brisbane, Perth and other places canvassing.
"Even if the effect certain to win dare not go out really hard." GBE attending the first Board of the acquisition Shao Yi recalled more than a feeling, for digestion of the China threat theory, in October 2010, Shao Yi led a delegation made a special trip to Australia to visit FIRB (Foreign Investment Review Board in Australia) and the Australian Federal Government Department of Mineral Resources Minister Martin Ferguson, stressed that "the acquisition is a commercial act", and before and after Christmas, East China Nonferrous's trip to FIRB, a special trip to explain the East not to help the Chinese government-controlled color World of Rare Earth, "the problem hard to detect, a move carelessly round loser."
East China Nonferrous overseas acquisitions
"A lot of resources abroad are very hungry for capital projects, as long as the money, all is well discussed." Shao Yi that "the financial crisis has not been in the past, European and American capital market is still a lack of funds, many of the listed company's share price has shrunk, full of Chinese enterprises opportunities. "
And specific to the East China non-ferrous, Shao Yi, located in the acquisition of overseas resources development by leaps and bounds one of the most important means, "a project to buy down to several hundred million, to five years, is likely to become billions, billions of company. "
In fact, colored in the acquisition of foreign mineral East has been a lot of sweet taste. In 2009, the East China Nonferrous subscription shares to complete the project in Australia Arafura has Arafura shares have risen 1.3 AUD / shares, and the purchase price at the time of East China Nonferrous 0.36 Australian dollars / share.
But Shao Yi admitted that foreign acquisition is a "pain and happiness," the process. In fact, one after another acquisition relative to the noise, but very few success stories, according to PricewaterhouseCoopers (PwC) statistics, although in 2010 the global mining industry mergers and acquisitions to heat up, but the Chinese side participated only in the acquisition of 6% of the world The mining industry transactions.
Arafura companies from Australia to Africa Weatherly International Plc (hereinafter referred to as "WTI"), South America, the Jupiter project, and then to Australia's Northern Uranium (hereinafter referred to as "NTU") and GBE, cruel facts of overseas M & A failures, one and once missed, making Shao Yi "no pocket before Buganshengzhang."
GBE Price at posting:
31.0¢ Sentiment: LT Buy Disclosure: Held
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