Anglo to finalise mine sale by month's end
Wednesday 10 May 2017
Australian Pacific Coal is a big step closer to transitioning from explorer to miner, with all conditions now met in its agreement to purchase the Dartbrook Coal mine in the Hunter Valley.
In a short statement this week APC said they hope to complete the sale before June.
“The company is pleased to advise that all conditions to the Share Purchase Agreement for the Company’s acquisition of the Dartbrook coal mine from its ultimate owners, Anglo American Plc and Marubeni Coal Pty Ltd, have now been satisfied or waived.”
The development follows an audacious move by the company’s two major shareholders Nic Paspaley and John Robinson and their jointly controlled company Trepang Services who got approval from other shareholders to loan APC $35 million to allow it to finalise the Dartbrook deal.
Not only does the loan have an interest rate of between 10 and 16%, it’s being loaned as convertible notes, which means that instead of having to be repaid, the value of the loan will be issued to the financiers in new shares - more than 10 billion of them.
Not only that, APC is now 85% controlled by Mr Robinson and Mr Paspaley, and they also have security over the company's assets.
Investors who accepted the deal will be hoping that the benefits that flow to APC from acquiring Dartbrook and transitioning from explorer to miner will outweigh the significant costs of having the value of their existing shareholding massively diluted.
While APC’s focus in the short term will be getting through the government approval process and restarting Dartbrook, the company has a number of interesting coal tenements in Central Queensland.
It has the Hillalong tenement adjacent to the Hail Creek mine, which Rio Tinto had a close look at in 2015, as well as the Cooroorah tenement between Curragh and Jellinbah mines near Blackwater.
That project has advanced to the mineral development licence stage and has a deposit of around 125 million tonnes of metallurgical and thermal coal.