Alsons offers to buy Australia’s Indophil PH stake for P14B

MANILA, Philippines – Mindanao-based Alsons Prime Investment Corporation (APIC) has offered to buy Australia’s publicly-listed Indophil Resources NL stake in the Philippines at AU$0.30 per share for AU$361 million (P14.3 billion) in cash, according to a report submitted to the Australia Stock Exchange early Tuesday, September 23.

Indophil has ongoing exploration projects in Manat in Eastern Mindanao, as well as stakes in the Balatoc copper-gold and Itogon gold projects in Northern Luzon.

Alsons owns the single largest bloc of shareholders in Indophil following a “placement agreement” in 2009 when the Filipino-owned company raised AU$97.7 million to hike its stake to 19.99%. The company also has interests in power generation and fisheries.

Alsons’ move was largely financed by Banco de Oro owned by tycoon Henry Sy.

Indophil Filipino board of directors Nicasio Alcantara of APIC and Frederic DyBuncio did not participate in the acquisition talks. Alcantara is chair of APIC while DyBuncio is representing the Sy-owned SM Investment Corporation.

The acquisition is subject to the approval of Indophil shareholders, the Australian Foreign Investment Review Board, and other regulations by the Australian government.

APIC meanwhile needs to secure the approval of at least 75% of Indophil shareholders to close the deal.

The Alsons offer was at 43% premium over the September 22 close of trading of Indophil shares. Indophil shares was valued at AU$0.21 at Tuesday’s trading at the Australian Stock Exchange.

Apart from Alsons, Filipino companies owning minority shares in Indophil include Manuel “Manny” Pangilinan of Philippine Long Distance Telephone Company and Ramon Ang of San Miguel Corporation.

Once approved, Alsons will, in effect, acquire the 37.5% stake of Indophil in Sagittarius Mines Incorporated (SMI).

Tampakan

SMI majority shareholder Glencore International, which owns 13.1% of Indophil, did not object to the acquisition. In addition to its shares in Indophil, Glencore also owns 62.5% of SMI, holder of the Tampakan copper and gold project.

The Tampakan project is touted as having the world’s largest untapped copper and gold deposits with a potential annual average production of 375,000 tons of copper concentrate for at least 17 years.

“Tampakan is projected to produce 375,000 tons of copper and 360,000 ounces of gold per year in the initial mine-life of 17 years, with potential for mine-life extension,” Indophil said in its acquisition disclosure.

On March 2014, Indophil said that low metal prices and market uncertainties have taken their toll on the planned commercial operation of the Tampakan gold and copper project. Prevailing world market conditions were further aggravated by the decision of SMI to significantly reduce the operations of the controversial South Cotabato-based mining company. – Rappler.com