News blog
Mercury Recycling
- BY: Andrew Hore |
- POSTED: 07/03/2012 |
Mercury Recycling is moving into the resources business by acquiring iron ore assets from AIM-quoted Sylvania Platinum.
At the suspension price of 6.75p a share, Mercury Recycling is valued at £2.42m. The deal is valued at £13.7m, which will be financed through the issue of 203m shares at a price of 6.75p a share. That will give Sylvania a 85% stake in Mercury Recycling. There will also be a placing to raise cash so the Sylvania percentage will reduce while existing shareholders will be hugely diluted by the deal and fundraising.
Shareholders have to vote in favour of the deal at a general meeting for it to go ahead. Many shareholders invested in the company because it was a recycling business. More recently management has indicated it was looking at resources businesses.
The iron ore assets are in the Northern Lobe of the Bushveld Complex north of Mokopane, South Africa. A maiden resource statement should be announced shortly. Due diligence is going on at the moment.
Sylvania boss Terry McConnachie and Peter Cox, who has been running the iron ore business, will join the Mercury Recycling board.
Download the latest AIM Journal from http://www.hubinvest.com/AIMPDFFebruary2012_29.pdf
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