JV Buyout & Further Thailand Expansion
METAL TIGER PLC
24 November 2015
Metal Tiger plc
("Metal Tiger" or the "Company")
JV Buyout & Further Thailand Expansion
Metal Tiger (LON:MTR), the natural resources investing company is pleased to provide an update with regards to the Company's plans to materially expand and accelerate the Company's exploration and development interests in Thailand.
As per the Company's announcement dated 7 October 2015, Metal Tiger had an option to acquire outright its Joint Venture ("JV") with Southeast Asia Mining ("SEAM") as announced 28 October 2014.
Subject to the points outlined below Metal Tiger has now exercised that option and will undertake the acquisition which will see the Company hold a net 90% of the original JV interests.
In addition, following a review of SEAM's wider Thailand operations, including the work undertaken during the Board's country visit in October this year, Metal Tiger has now negotiated an additional option (the "SEA Option") to acquire the Thailand interests of SEAM's Canadian parent entity, Southeast Asia Mining Corp. ("SEA"), which includes SEAM and two other SEA subsidiaries, eight prospecting licence applications surrounding historical lead-silver-zinc mines in Western Thailand and two mining lease applications that overlay historical mining lease applications in the area, plus the exploration and mining database compiled by SEAM during its operations in Thailand since its incorporation in 2006. Further details of the SEA Option are provided below.
Cameron Parry, CEO of Metal Tiger commented: "We are very pleased to announce the exercise of Metal Tiger's option to acquire the original Thailand JV entered into with SEAM in October 2014. Building on this initial transaction we are delighted to announce the further option to significantly expand our Thai interests through the potential acquisition of SEAM and the remaining Thai interests of its Canadian parent entity, SEA.
Metal Tiger was founded with one of its key objectives to build substantial precious and strategic metals interests in South East Asia. This new option comes after five years of extensive work in Thailand and developing a working relationship with SEAM over the past three and a half years.
The Metal Tiger Board are of the view that Thailand offers unique and substantial exploration and development opportunities for companies with a good understanding of the operating environment in the natural resources sector and how to conduct operations on the ground. Metal Tiger has established a team in-country that is already highly active in the enhancement of our existing interests and in the proactive search for new opportunities.
Should the additional option to acquire SEA's Thai interests be exercised and proceed, it will mark a major strategic increase in Metal Tiger's commitment to secure, and capacity to realise, commercial opportunities in Thailand. Furthermore we will have diversified our interests from the existing Copper-Gold-Antimony, to encompass Silver-Lead-Zinc and the prospect of an interest in assets with production potential alongside our exploration interests.
Following this announcement and as our due diligence progresses we will release further information to market in respect of the additional option interests."
Exercise of Option to Acquire Initial JV
On 7 October 2015, the Company announced that it had entered into an option to acquire its current Thailand Joint Venture with SEAM for total consideration of US$50,000 including a US$10,000 option fee and that this option was due to expire at the end of October 2015. MTR has since agreed to exercise the SEAM JV Option by paying the balance consideration of US$40,000.
Metal Tiger is now progressing the relevant paperwork with regard to option exercise and we anticipate this will be completed shortly.
Option to Acquire SEA's Thailand Interests
SEA Option - Overview:
In addition to exercising the Initial JV option Metal Tiger has now entered into a further option with SEAM's Canadian parent entity, Southeast Asia Mining Corp. (SEA"), to acquire its Thailand interests and subsidiary companies with assets in Kanchanaburi Province, Western Thailand. The assets the subject of the SEA Option include: SEAM and SEA's two other Thai subsidiaries - Southeast Asia Mining Company Limited and Southwest Asia Resources Company Limited. SEA, through its subsidiaries, holds, eight Special Prospecting Licence Applications ("SPLA") surrounding the historical Boh Yai and Song Toh zinc-silver-lead mines and two Mining Lease Applications ("MLA") overlaying the historical mining lease applications. SEA has completed an NI 43-101 compliant Preliminary Economic Assessment on the mines based on 22 years of operational records. The mines have a compliant resource of 4.9 million tonnes (excluding a 195,000 tonne historical resource) and have only been mined to 150m depths. There remains significant down dip potential. The mines have been on "care and maintenance" since 2002 when low metals prices dictated operations to shut down (although they did successfully run 60,000 tonnes of ore through the mill in 2008).
SEAM holds eight SPLAs with significant exploration potential directly surrounding the mines totalling 5,660 hectares. To date, SEAM has conducted 5 years of exploration on the areas of the properties during license phase, conducting soil sampling and rock chip sampling followed by induced polarized and magnetic geophysics. From the completed work, SEAM geologists have concluded that the results identify drill ready targets north and east of the Song Toh mine and warrants a reconnaissance drilling program which could significantly upgrade the resource of the project.
Metal Tiger has paid a non-refundable fee of $30,000 to secure the SEA Option which will be forfeited and expire, if not exercised on or before 15th February 2016.
During the option period Metal Tiger is able to undertake further due diligence as it deems necessary. SEA undertake to initiate the calling of a general meeting of SEA shareholders to approve the disposal of its interests in Thailand and its Thailand Subsidiaries (the "General Meeting") and that such General Meeting is to be held within 67 days from the date of the agreement. SEA has agreed to use its reasonable endeavours to procure that its shareholders vote to approve resolutions proposed at the General Meeting ("Shareholder Approval"). If Shareholder Approval is not granted, Metal Tiger would forfeit its deposit.
Subject to Shareholder Approval, exercise of the SEA Option is at Metal Tiger's sole discretion and subject to any necessary stock exchange or related advisor approvals.
Furthermore, SEA undertakes that SEAM and its subsidiaries will complete actions to alleviate working capital liabilities in the companies before Metal Tiger elects to exercise the SEA Option.
Should Metal Tiger elect to exercise the SEA Option the initial consideration totals US$500,000 which must be satisfied on or before the date of Option Period expiry.
The payment will be satisfied by the payment of US$200,000 in cash (the "Cash Payment") and US$300,000 through the issue of new ordinary shares in Metal Tiger (the "Share Payment") at a price calculated per new ordinary share being the volume weighted average price ("VWAP") for the 14-day calendar period immediately prior to SEA shareholder approval of the SEA Option (collectively the "Consideration").
In addition, Metal Tiger has also agreed that subject to SEAM being granted its primary target prospecting licence 1/2557 in the Kanchanaburi province, it will pay SEA shareholders a further US$100,000 in cash, ensure SEAM and the other SEA subsidiaries have certain conditional working capital amounts and grant to SEA shareholders a number of warrants equal to the number of new ordinary shares issued as part of the satisfaction of the Share Payment element of the Consideration (the "SEA Warrants"). The SEA Warrants will be subject to a 3 year term from the date of exercise of the SEA Option and will be subject to an exercise price of twice the share price per ordinary share at which the Share Payment is issued.
SEA Thailand Interests
Original Option now Exercised:
Following exercise of the original option announced to market on 7 October 2015 Metal Tiger now holds 90% of Joint Venture interests. The interests include:
- One Exclusive Prospecting Licence ("EPL") in respect of a Gold-Antimony focused project in the Chanthaburi province, in the South East of Thailand where the Company has published findings from initial work undertaken by the JV during 2015 including the identification of gold anomalies requiring further investigation;
- One Mining Lease Application ("MLA") in the Chanthaburi province situated in what is known locally as the 'Gold-Antimony Belt';
- Two Special Prospecting Licence Applications ("SPLA") covering 31 square kilometres and relating to projects in the Nakon Sawan and Lopburi provinces within the Loei-Phetchabun part of what is known locally as the 'Copper-Gold Belt'.
SEA Option to Acquire Remaining SEA Interests:
The additional option to acquire the remaining interests of SEA relates to the following interests:
- Eight SPLAs surrounding the historical mining operations at Boh Yai and Song Toh Silver-Lead-Zinc mines in Western Thailand where historical Metallgesellschaft and German consultant records indicate over five million tonnes of crude ore was processed producing approximately 520,000 tonnes of concentrate to smelter over a 22 year period;
- Exploration and Mining database specifically relating to Boh Yai and Song Toh mines. This includes local/regional mapping, soil & rock chip sampling and three geophysics programs. Furthermore, the dataset includes material utilised to produce a NI 43-101 resource and Preliminary Economic Assessment extending to mine planning, geology and micro mine files, economic modelling and conceptual tailings planning;
- Two Mining Lease Applications overlaying historical Kanchanaburi mining lease applications.
In addition to the above applications and exploration & mining database, we are pleased to confirm that on option exercise the local Thai operating team will include key members of the SEAM organisation who have extensive operating experience in Thailand.
For further information on the Company, visit: www.metaltigerplc.com or contact:
Metal Tiger Plc
Cameron Parry (CEO)
Tel: +44 (0)207 099 0738
Paul Johnson (Executive Director)
Tel: +44 (0)7766 465 617
Spark Advisory Partners Limited (Nominated Adviser)
Tel: +44 (0) 2033 683 555
SI Capital (Sole Broker)
Tel: +44 (0) 1483 413 500
Notes to Editors:
Metal Tiger Plc is a natural resources focused investing company quoted on the London Stock Exchange AIM Market ("AIM") with the trading code MTR and two investment divisions, Direct Projects and Direct Equities.
The Direct Projects division invests in operational mineral exploration projects with current investments in Spanish Gold & Tungsten, Botswanan Copper & Silver, Thai Gold, Copper & Antimony, and Tanzanian Gold and Uranium. The Direct Projects investment division also has working collaborations to identify new investment opportunities in Russia (platinum focus) and Turkey (gold focus), in association with experienced in-country partners.
The Direct Equities division invests in quoted natural resource explorers and developers, with a combination of shares and warrants providing a potential non-debt financing instrument and enhanced return potential.
Metal Tiger's target is to deliver a high return for shareholders by investing in significantly undervalued and/or high potential opportunities in the mineral exploration and development sector timed to coincide where possible, with a cyclical recovery in the exploration and mining markets
This information is provided by RNS