Proactive Investors UK release on Newcrest Solgold brings mining heavyweight Newcrest to the table
Proactive Investors
August 30, 2016
https://www.proactiveinvestors.co.uk/companies/news/129825/solgold-brings-mining-heavyweight-newcrest-to-the-table-129825.html
Solgold PLC (LON:SOLG) has signed a conditional agreement with Australian mining heavyweight Newcrest under the terms of which Newcrest looks set to take a 10% stake in the company.
The deal needs to be put to shareholders at a vote, but the board of Solgold has said that it will recommend that the subscription deal goes ahead, “subject to no superior proposal being received.”
That last statement points to a significant truth about this deal: Solgold has been promoting the sometimes stunning intercepts at its Cascabel copper-gold project in Ecuador for some years ago, and it’s always looked likely that at some stage Cascabel would be taken out by a bigger player.
So, this could either be the opening round in a bidding war, or it could be straightforward enough signpost to Newcrest’s eventual ownership of the project.
Major shareholders, including those associated with Solgold chief executive Nick Mather, have already indicated they will support the deal.
At this stage, Newcrest’s interest will inject around US$10.8mln in new money into the company. The shares were unchanged at 7.38p on the news.