Looks like the rumour was true. Its Definitely what is putting downward pressure on the share price. With another bunch of nim nuts in the loop this court case could stretch out further.
I get the feeling they could be delaying the BFS so that CHM don't have an idea of what stage2 is really worth. Good tactic I think...just hope they either settle soon or the judge hands down a decision.
A STRATEGIC alliance with Chameleon Mining may have caught some people by surprise when it was announced by Cape Lambert Resources today, but for executive chairman Tony Sage it represents a low-risk expansion of Cape Lambert?s Mid West iron ore holdings, and the opportunity to gain a slice of the mighty Jack Hills iron ore play.
Sage has been quietly building his portfolio in the Mid West through his vehicle Fe, and now with Chameleon Mining in its fold, he has emerged to become the region?s second-largest iron ore landholder, with ultimate ambitions to become number one.
The news also set a blow torch to Chameleon?s shares with its price soaring by more than 26% in morning trade.
Through his various subsidiaries, Sage said he also controls all of the ground around Sandfire Resources? highly prized DeGrussa copper project in Western Australia.
In a move that mirrors previous deals done by Sage in the uranium and gold space that led to Scimitar and Jackson merging last year to become Cauldron Energy and saw Tianshan Goldfields morph into Corvette Resources in February and become a much larger gold play, Sage is looking to his majority stakes in Fe (17.5%) and Chameleon (15%) to grow his iron ore story.
?Everyone laughed at me six months ago when I said we would become the number two iron ore holder in the Mid West,? he told Miningnews.net.
With Chameleon?s ground abutting the Sino iron ore property and close to Padbury Mining?s tenements, another company set to be gobbled up by Sage through Fe [a formal bid will be lodged on August 24], obvious synergies start to emerge.
He is confident his pitch for Padbury will succeed, despite Padbury last month urging shareholders to take no action over the Fe cash and scrip bid until certain aspects of the offer were clarified.
In particular, Padbury was seeking clarification over the amount being offered.
If the Padbury deal comes off, Cape Lambert?s holdings in the Mid West would cover 4000 square kilometres.
However, Sage is also keeping a close eye on the court litigation currently being played out behind the scenes between Chameleon against Murchison Metals over the Jack Hills iron ore project.
?Judgement in the court case is still outstanding but I believe there have been settlement talks going on behind the scenes,? he said.
?Getting a percentage of Jack Hills would just put the cream on top of the cake.
?I will become a director of Chameleon shortly and will then start to investigate settlement talks, but I would prefer to secure a percentage of Jack Hills rather than a cash settlement.?
Industry talk is that a settlement would be worth tens of millions of dollars.
Chameleon believes it is entitled to Murchison?s share in Crosslands, the vehicle that holds Murchison?s Mid West iron ore tenements via a joint venture with Japanese company Mitsubishi.
Chameleon is seeking to force Murchison to either hand over its stake in Crosslands, or the profits made from either its ownership of Crosslands or the sale of half the company to Mitsubishi.
While not looking to make further acquisitions in the Mid West, Sage said he was looking to secure some additional iron ore rights in the region.
As part of the deal, Cape Lambert will provide Chameleon with $A6.5 million credit facility and board representation comprising Sage, Jason Bontempo and Paul Kelly.
Chameleon will also undertake a placement to Cape Lambert (worth $2 million) and Sage and Bontempo (worth $400,000 and $100,000 respectively) to raise a further $2.5 million.
The placement includes a three for five attaching option exercisable at 1.5c on or before December 31, 2012.
Shares in Cape Lambert were up 2.7% in morning trade to 38c, while shares in Chameleon were up 26.32% to 2.4c.
MMX Price at posting:
$1.75 Sentiment: Hold Disclosure: Held
