Approval to Acquire Meekatharra Gold Assets Obtained
Perth, June 13, 2014 AEST (ABN Newswire) - Further to our previous announcement of 14 May 2014, the Board of Metals X Limited (
ASX:MLX) (MTXXY:OTCMKTS) is pleased to advise that the creditors of GMK Exploration Pty Ltd (GMKE in Administration) have today agreed to the sale of its assets to Big Bell Gold Operations Pty Ltd (BBGO), a wholly owned subsidiary of Metals X Limited. In addition, Metals X has received FIRB approval and is now proceeding toward settlement.
At the creditors meeting yesterday, the administrator (Ferrier Hodgson) revealed an additional 'five-minutes-to-midnight' offer. The administrator advised at the meeting that he had been legally silenced on exposing the name of the offeror, advising that the offer was genuine and the party was well funded and financially capable of completion. Another competing offer, fully disclosed but conditional upon obtaining funding was also presented to the meeting.
Metals X increased its offer at the meeting to a matching amount and the creditors voted in favour of the deal in a poll. The total acquisition price agreed by Metals X is $9.4M in cash and 24 million shares in Reed Resources Limited.
Metals X's Managing Director, Peter Cook commented:
"We were extremely surprised that a conditional offer from an undisclosed party was put forward at the last minute to potentially scuttle a fully funded, disclosed and agreed purchase by Metals X. The offer only materialised after announcement to the ASX of the agreement Metals X reached with the administrator. Metals X undertook thorough due diligence before entering into the purchase process with the administrators and finds it scurrilous and unconscionable that an unnamed party decided to take advantage of this work at such a late stage.
However we are pleased to have won the support of the creditors and now to have a clear path to completion and development of our combined Murchison Region gold assets.
Even with a slightly higher purchase price, this remains a great acquisition for Metals X and a major step forward for our plans to bring our Central Murchison Gold Project to fruition. It also adds 3.5 million ounces to our existing 5.0 million ounces of Total Mineral Resource at the CMGP, leaving us a massive long term option on the gold price. The purchase price remains astounding value when compared with the $120M in capital expenditure we would require to build a new plant for our own ores."
As was previously announced, the assets to be acquired include:
- The fully refurbished Bluebird CIP Process Plant (nominal 2.5 Mtpa capacity).
- A 200 person fully refurbished camp.
- Extensive infrastructure, service vehicles, equipment and inventory.
- A total mineral resource inventory of 3.55 million ounces (63 Mt @ 1.75 g/t Au) as previously announced by Reed as of 30 June 2012.
- A Total Ore Reserve (when operating) of 752,000 ounces (11.1 Mt @ 2.1 g/t Au) as previously announced by Reed as of 30 June 2012.
The consolidated asset profile of the merged projects are summarised as:
- 8.5 million ounce Total Mineral Resource (126 Mt @ 2.10 g/t).
- 1.89 million ounce Total Ore Reserve (26.7 Mt @ 2.20 g/t Au).
- 2.5 Mtpa CIP process plant (fully refurbished).
- 200 person accommodation village (fully refurbished).
- Substantial surface infrastructure.
About Metals X Limited
Metals X Limited (
ASX:MLX) (OTCMKTS:MTXXY) is a Diversified Resource Company. Australia's largest tin and one of Australia's top 10 gold producers. Considerable cashflow is generated from its two operating gold mines at South Kalgoorlie and Higginsville in WA and from its 50% owned high grade tin mine in Tasmania which is also one of the largest hard rock tin mines in the world. The company boasts resources of over 14 Moz of gold, 140,000 tonnes of contained tin and over 2 million tonnes of contained nickel. The company also has a considerable portfolio of growth assets, including one production ready and one development ready gold project and one of the world's largest undeveloped nickel and cobalt projects.
The Central Murchison Gold Project consists of a fully refurbished 2.0Mtpa gold plant and resource containing over 8.6 Mozs of gold in a combination of high grade underground mines and lower grade open pits, expected to be in production in early 2015. The Company's Rover 1 iron-oxide-copper-gold discovery contains 1.2Moz of gold equivalence which is targeted for production in 2016.
The 100% owned world class Wingellina Nickel and Cobalt Project hosts a global resource of over 180Mt at 1% nickel that includes 167Mt as a probable reserve. Metals X has joined with one of the World's largest companies, Samsung C and T, to work together to finance and develop the Wingellina project.
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