The Robert Champion de Crespigny-chaired Scarborough Minerals plc has joined the current wave of corporate activity in the resources sector, announcing an interest in merging with Perth-based minerals investor Mineral Securities Ltd.
The Robert Champion de Crespigny-chaired Scarborough Minerals plc has joined the current wave of corporate activity in the resources sector, announcing an interest in merging with Perth-based minerals investor Mineral Securities Ltd.
The companies released a joint announcement confirming preliminary discussions of the merger proposal, with the current plan being for Mr Champion de Crespigny to serve as chair of the new company, appointing MinSec's executive chair Keith Liddell as chief executive.
Mr Liddell said the merger would be a natural step in his company's progress.
"I believe the combination of our skill sets and assets with Scarborough's would enable us to deliver significant value to both groups of shareholders," he said.
Mr Champion de Crespigny said he had been impressed by MinSec's growth over a short time, and was pleased at the prospect for a merger.
The companies plan to make a further announcement in due course.
Scarborough was formed through a three-way merger of Perth-based Gold explorer Danae Resources NL, Greenwich Resources plc, and Buka Ltd earlier this year engineered by Mr Champion de Crespigny, after the 2002 sale of what was then Australia's biggest gold miner, Normandy Mining Ltd, to Newmont Mining for $4.3 billion.
Scarborough acquired an 18.3 per cent holding in MinSec earlier this year, after a complicated cash and scrip deal saw MinSec take Scarborough's shareholding in copper producer CopperCo Ltd.
The company also has interests in platinum explorer PlatMin Ltd, gold explorer Tianshan Goldfields Ltd and nickel explorer Zambezi Resources Ltd.
Shares in MinSec closed up 2.7 per cent to $1.50.
The full text of the joint announcement is pasted below
The Directors of Mineral Securities Limited ("Minsec") and Scarborough Minerals plc ("Scarborough") advise that they are in discussions in relation to a possible recommended merger of the two companies (the "Proposal").
The structure of any proposed merger is still under discussion and Scarborough and Minsec are considering a number of options with the aim of enhancing shareholder value. It is likely that any such transaction would be based on a share exchange ratio which reflects their joint assessment of the relative net asset backing of the two companies' shares.
It is intended that if a transaction is completed Scarborough's Chairman, Robert Champion de Crespigny AC, would be Chairman of the merged business and Minsec's Executive Chairman, Keith Liddell, would be Chief Executive Officer.
Speaking on the Proposal, Mr Champion de Crespigny said "We are very pleased at the prospect of a merger with Minsec. I have been impressed with the way that Minsec has developed in a very short time, putting together some exciting investments under Keith Liddell's direction."
Mr Liddell commented, "A combination of Minsec and Scarborough would be a natural step in Minsec's progression to becoming a larger resource investment house. I believe the combination of our skill sets and assets with Scarborough's would enable us to deliver significant value to both groups of shareholders."
There can be no guarantee that agreement on the final terms of the Proposal will be reached or that the Proposal will proceed. A further announcement will be made in due course.
