Hello,
For those who do follow Buka, I thought this article might be of interest (if it hasn't already been posted).
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De Crespigny advances copper strategy
By: Peter Gonnella
Posted: '17-JUN-04 14:45' GMT © Mineweb 1997-2004
PERTH (Mineweb.com) -- The Robert Champion de Crespigny-led resources vehicle Buka Minerals [ASX:BKA], has offloaded one of its key assets in an agreement designed to create an emerging Aussie copper play.
Sydney-based Buka and Perth-based Avon Resources [ASX:AVN] jointly announced today (Thursday) that CopperCo, the proposed new name for Avon, is expected to graduate from explorer to significant Aussie copper producer in a couple of years following the vending of the Lady Annie copper project and associated tenements in Queensland into the Avon copper portfolio.
In the second half of calendar 2004 CopperCo plans to launch a bankable feasibility study (BFS) into the standalone development of Lady Anne, which is forecast to have a capital cost of roughly A$35 million and slated to have the potential to produce at least 15,000 tonnes of copper cathode per annum for an initial 7-8 years starting around mid-2006. It will also be the platform to grow the company’s copper resources inventory in the area – to a targeted 150,000t of contained metal by the end of 2004 – from which to sustain long-term operations.
For Buka, the sale of Lady Anne is worth around A$14-$15 million, made up of about half staged payments of cash and half in stock, which if shareholders approve will see de Crespigny’s group assume a 36.6 percent shareholding in Avon before any further share issues. Avon’s issued capital will swell from 289 million to a whopping 819 million shares once the Buka deal is done. The expanded issued capital also takes into account contemporaneous acquisitions of copper properties via the purchase of two private companies.
Avon says it then intends raising about A$11 million through a combination of equity and mezzanine debt funding with about half the proceeds to go towards completing the BFS. As a result Buka will wind up with somewhere in the order of 25 percent of Avon.
Investors greeted the deal warmly, pushing Buka and Avon’s shares up six and 12.5 percent today to A$0.345 and A$0.027 respectively, giving them current market capitalisations of about A$47 million and A$22 million (post-Lady Anne purchase).
There has been much speculation in the past few months surrounding de Crespigny’s possible resources comeback strategy ever since he and others referred to as the “new investor group” took up an equity stake of 30.5 percent in Buka, with the most notable being that it may try to buy the Golden Grove polymetallic operations from Newmont Mining, who inherited it from de Crespigny’s Normandy Mining a couple of years ago.
However, this Lady Anne transaction seems to mark a different corporate focus for Buka. “It reflects a change in direction for the company from that of a developer of mining projects to an investor in and provider of finance for resource companies and projects,” said managing director John Richards. “A 15-30 percent interest in a company or project would be our typical involvement,” he told Mineweb, which means Buka will likely back other groups rather than acquire and manage outright.
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bye. dub
BKA
buka minerals limited
