Brisbane’s Metro Mining Limited announced yesterday that it has signed an agreement with Greenstone Resources II Ltd that grants Greenstone a 19.98% interest in Metro in addition to providing Metro with assistance in developing its Bauxite Hills Project.
The agreement has Greenstone investing an initial US$6.76 million by way of a placement of 105 million shares at US$0.06 per share, which translates to a 27% premium on the closing price last Friday, and a 21% premium over the firm’s thirty-day volume weighted average. Payment will be made in two installments, the first of US$6.12 million and the second of US$660,000, both to be raised via stock issues. The second payment is planned for late August.
The agreement further stipulates that, should the parties come to an agreement on the terms and a decision on construction at Bauxite Hills, Greenstone may invest another US$20 million to continue the Bauxite Hills project.
“We are very pleased to welcome Greenstone on to our share register as a strategic cornerstone investor,” said Metro Chairman Stephen Everett. “They have an excellent reputation and a proven team with strong technical and financial expertise. This is a strong endorsement of Metro’s board and management team and the quality of the Bauxite Hills Project. Greenstone’s initial equity investment and conditional commitment to a follow-on investment of up to US$20M of construction equity lays the foundations for a credible project financing and development pathway. With the technical, strategic and financial support of Greenstone, the development of Bauxite Hills is further de-risked. We look forward to completing the transaction with Greenstone and rapidly bringing Bauxite Hills into development.”
Greenstone, headquartered in Guernsey, is a private equity fund specializing in the mining and metals sector. Its particular focus in mining is development and operation, particularly as it relates to alumina and aluminium.