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Published on 10th September 2008
Updated 4 hours ago
Diversified mining giant Anglo American announced on Wednesday that it would acquire 13,47-million fully paid ordinary shares in Australian mineral exploration company Magma Metals at $0,60 a share.
Anglo said that following the $8,08-million transaction, it would hold a 12% interest in Magma and would nominate one non-executive director to Magma’s board of directors. Anglo would also have the right to participate in any future share placements.
The value of the transaction represented a 43% premium to the closing price of Magma’s shares on September 9. Funds from the share placement would primarily be used to complete the current 24 000-m diamond drilling programme and the Thunder Bay North project, and to finance follow-up drilling programmes and geophysical surveys designed to establish the scale and scope of the project.
Anglo American planned to issue the shares and complete the settlement of this transaction within five working days.
Anglo is one of the world’s largest diversified mining companies and is a major producer of base metals, as well as the world’s largest producer of platinum. It has significant experience in exploration, development and operation of large base-metals and platinum-palladium projects.
Anglo stated that this expertise would be of significant benefit to Magma, particularly in relation to its advanced Thunder Bay North platinum, palladium, copper, and nickel project in Canada.
It was planned that an advisory technical committee would be established, which would include representatives from Anglo, to provide input to the exploration and future potential development of this project.