ISR Capital raises stake in Madagascar firm to 60%
Investment firm ISR Capital has entered into an agreement to
acquire a further 40.1 per cent stake in a Madagascar rare earth concession
holder from Reo Magnetic for S$26.7 million.
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Anita Gabriel
02 July 2016
Investment firm ISR Capital has entered into an agreement to acquire a further 40.1 per cent stake in a Madagascar rare earth concession holder from Reo Magnetic for S$26.7 million.
This, coupled with an earlier agreement inked last month for ISR Capital to acquire 19.9 per cent interest in Tantalum Holdings (Mauritius) for S$13.3 million (total acquisition price of S$40 million), will be paid by issuing 400 million new ISR Capital shares at 10 Singapore cents each to Reo Magnetic.
This represents some 21.1 per cent of the enlarged issued and paid-up share capital of ISR Capital following the completion of the issuance of the consideration shares, said ISR Capital in an announcement to the Singapore Exchange.
Reo Magnetic is owned by Singaporean and foreign investors with experience and interest in the mineral, oil and gas industry, said ISR Capital.
Reo Magnetic is selling all its interest in Tantalum Holdings, which owns 100 per cent of a Madagascar-incorporated company which holds a permit to explore and develop a concession hosting critical rare earth elements in Madagascar.
The owner of the remaining 40 per cent of Tantalum Holdings is Tantalus Rare Earths - a company incorporated in Germany with shares quoted on the OTC (over the counter) Market of the Dusseldorf Stock Exchange.
"Given the critical and strategic value of rare earth oxides in the global market, we firmly believe this is a key acquisition for ISR Capital that will generate strong returns for our shareholders," said ISR Capital executive director Quah Su Yin.
ISR Capital said it has appointed Empire Capital Partners as corporate advisers for the acquisition. Empire Capital will also lead and manage a fund-raising exercise for up to S$30 million; the funds are expected to be utilised for the concession in a pilot production of rare earth oxides and for further development.
The company also disclosed that David Rigoll, who joined ISR Capital's board in May this year and only two weeks ago was re-designated from non-executive director to executive director, used to be a director and shareholder of Tantalus Rare Earths and director of the target company.