$45 m US for 51% small advanced gold deposit SJ worth over $1 billion based on high acquisition cost..
We would consider acquisition targets that fulfill criteria including, among others, (i) within Shandong Province; (ii) either open-pit or underground mines with potential gold resources of at least 10 tonnes and a depth of less than 1,000 metres for better economic benefits; (iii) has LoM of over five years after commencement of operations (excluding mine construction period); and (iv) has payback period of less than ten years. For acquisition target that is a mine near commencement of commercial operations, we expect the acquisition cost for the mining right to be high as we expect such mining asset would have a valid mining licence of over two years, valid land-use-right and related mining infrastructure (including an ore processing plant) ready for use.
– 317 –
THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED ‘‘WARNING’’ ON THE COVER OF THIS DOCUMENT.
FUTURE PLANS AND [REDACTED]
As of the Latest Practicable Date, we had not engaged in any negotiation or entered into any letter of intent or agreement for potential acquisitions, and had yet to identify an acquisition target. However, our Directors were aware there were not less than five companies in the Shandong Province that fulfil certain of the abovementioned selection criteria available for our selection. We intend to, through our indirect wholly-owned subsidiary in Hong Kong, establish a new sino-foreign joint venture entity in the PRC after the [REDACTED], to acquire a controlling stake of not less than 51% of the equity interest in a mining asset. A combination of the [REDACTED] from the [REDACTED] of RMB[REDACTED] and internal resources of the remaining amount will be used to fund all of our portion of the total initial commitment of capital contribution of the joint venture entity in the aggregate amount of not less than RMB300 million. It is intended that the capital contribution will cover, among others, the acquisition cost for mining licence, the value of the mining asset and additional investment for construction of additional mining infrastructure. The capital will be contributed by both parties in stages over a period of two years after the date when the business licence of the joint venture entity is obtained. If the capital contribution amount is not sufficient to cover the abovementioned costs or if the new mining asset requires further investment for further development of mining infrastructure or working capital, we expect the joint venture entity to obtain external financing from banks and/or further capital contribution from its shareholders. For further information, please see the section headed ‘‘Business — Business strategies — Expand our business and grow our market sh