Viking Ashanti brings Mongolian coal developer into its fold
Viking would issue more than 129.7-million shares to Auminco shareholders, resulting in that company holding a 59% interest in the enlarged entity, with Viking’s current shareholder base retaining a 41% interest.
The gold developer would also undertake a minimal capital raising of A$4.5-million early in 2014, to fund operations, complete internal production feasibility studies, and to make development decisions.
“Viking is delighted with the proposed acquisition of Auminco and its portfolio of high-quality strategically located coal assets in Mongolia, two of which have near-term production potential,” said Viking Ashanti chairperson Jack Gardner.
“Mongolia is host to vast coal and mineral wealth and has excellent proximity to Chinese and Russian coal offtake markets, where steel production continues to grow. The achievement of Auminco in gaining quality assets and mining approvals in Mongolia gives Viking excellent prospects of early production and positive cash flow.”
Gardner added that combined with Viking Ashanti’s Ghanaian gold assets and its management team, the merger augured well for Viking’s successful and sustainable growth in the challenging global equities environment.
Auminco’s Mongolian projects include five coal projects and one zinc project. The company’s flagship asset, the Khonkhor Zag metallurgical coal project, has been the focus of recent exploration, with a resource estimate expected in December.
The merger is subject to a number of conditions, including due diligence by both parties and shareholder and government approval. The merger is also conditional on Viking raising no less than A$4.5-million in equity capital.
By: Esmarie Swanepoe
Edited by: Mariaan Webb