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Cobalt 27 definitive scheme implementation agreement with Highlands Pacific

Mining News - Published on Fri, 04 Jan 2019

Image Source: International Mining
Cobalt 27 Capital Corp announced that it has entered into a definitive scheme implementation agreement with Highlands Pacific Limited dated January 1st 2019, pursuant to which Cobalt 27 will acquire all of the issued ordinary shares of Highlands that it does not own by means of a scheme of arrangement under Part XVI of the PNG Companies Act in Papua New Guinea.

Key highlights of the transaction include:
Creation of a leading high-growth, diversified battery metals streaming and royalty company
Increases exposure to a large, long-life, low-cost, high-growth nickel-cobalt mine (Ramu)
Expands and diversifies existing portfolio with increased nickel exposure
Accretive to Cobalt 27 shareholders
Attractive re-rating potential
Repayment of Ramu partner loans after closing will accelerate cash to Cobalt 27

Mr Anthony Milewski, Chairman and CEO of Cobalt 27, said that "The acquisition of Highlands will allow Cobalt 27 to gain a direct interest in the Ramu nickel-cobalt mine and materially increase its attributable exposure to the mine's nickel production from 27.5% to 100% and cobalt production from 55% to 100%, relative to the previously announced Ramu Cobalt Nickel Stream. It does so at nearly half the cost of the previously announced Ramu Cobalt Nickel Stream, provides increased balance sheet flexibility, and enhances value for Cobalt 27 shareholders. It also brings cash flow to our business, something we have told our shareholders was important from the beginning."

Highlands' key asset is its 8.56% interest in the Ramu nickel-cobalt mine ("Ramu") located near Madang on the north coast of PNG. Following repayment of Highlands' attributable Ramu construction and development loans, Highlands' ownership would increase to 11.3%. Ramu is majority-owned and operated by Metallurgical Corporation of China Limited ("MCC") which holds a 67.02% stake in MCC-JJ Mining which owns 100% of MCC Ramu NiCo Ltd. ("MCC – Ramu"), holder of an 85% joint venture interest in Ramu. The Government of PNG and local landowners (the "PNG Stakeholders") own a 6.44% stake in Ramu, which would increase to 8.7% upon repayment of construction and development loans. The Ramu mine was financed and constructed by MCC for USD 2.1 billion which, at the time, was China's largest overseas mining investment. MCC is listed on the Hong Kong Stock Exchange and Shanghai Stock Exchange with a market capitalization of approximately US$9 billion.

Source :

Posted By : Rabi Wangkhem on Fri, 04 Jan 2019
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