Ansteel takes bigger slice of Karara pie
PERTH (miningweekly.com) – China’s Ansteel has moved to take majority ownership of the Karara iron-ore project, in Western Australia, project owner Gindalbie Metals said on Wednesday.
The ASX-listed company reported that Ansteel, which is a joint venture (JV) partner in the project, had exercised its right to convert two shareholder loans of A$60-million in total to new shares in Karara Mining Limited (KML), which operates the project.
The conversion would result in Ansteel increasing its ownership in Karara from 50% to 52.16%, with Gindalbie owning 47.84%.
Ansteel will be issued with a total of more than 13.9-million new KML shares at an issue price of A$4.31 per share. Once the new shares are issued, KML will have a total of 321.98-million shares on issue with Gindalbie holding just over 154-million shares and Ansteel the balance.
Ansteel also has the right to subscribe for new equity in KML to provide the operator with sufficient funds to repay additional bank debt and concentrate presales agreements totalling $230-million.
This debt-to-equity conversion, if exercised, would increase Ansteel’s stake in KML to approximately 62% with Gindalbie retaining approximately 38%.
As a result of the changed ownership structure, the KML board would now be expanded from four to five directors, with three representatives from Ansteel. The KML chairperson would also be an Ansteel representative and would have a casting vote at KML board meetings.
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