LONDON - Metals Exploration PLC (MTL) and Condor Gold PLC have reached an agreement for MTL to acquire the entire issued and to be issued ordinary share capital of Condor Gold. The transaction, valued at approximately £67.5 million, is to be executed through a court-sanctioned scheme of arrangement under Part 26 of the Companies Act 2006.
Under the terms of the offer, Condor Gold shareholders will receive 4.0526 new MTL shares plus 9.9 pence in cash for each Condor Gold share. This values Condor Gold's existing issued ordinary share capital at around 33.0 pence per share based on MTL's closing middle-market price on the last business day before the offer period began.
Additionally, Condor Gold shareholders are entitled to one Contingent Value Right (CVR) per share, potentially increasing the total consideration. The CVR entitles shareholders to a pro rata share of up to US$28.8 million contingent on the first gold pour from La India mining operations within a specified timeframe and the discovery of additional gold resources.
The offer reflects a premium of 16.8% to Condor Gold's closing price on the last business day before the announcement and significantly higher premiums when compared with the volume-weighted average prices of Condor Gold shares over the preceding 20-day and three-month periods.
Upon completion, Condor Gold shareholders are expected to hold approximately 33.8% of the enlarged share capital of the combined entity. The acquisition is subject to approval by MTL shareholders, with MTL's largest shareholders already committing to vote in favor of the resolutions at the upcoming general meeting.
The Condor Gold directors, advised by Beaumont Cornish, have unanimously recommended the offer to their shareholders, believing it to be in their best interests. The directors, who hold approximately 4.1% of Condor Gold's shares, have committed to vote in favor of the scheme.
Condor Gold had previously announced its intention to find a buyer for its primary asset, the La India Project. The agreement with MTL follows a series of discussions and due diligence, with MTL's offer considered the best opportunity for Condor Gold shareholders.
MTL, a gold exploration and production company with projects in the Philippines, sees the acquisition as a strategic opportunity to diversify and create a larger, more mature gold exploration and production company. The deal is expected to enhance the combined group's ability to bring Condor Gold's assets into production, with MTL's CEO's experience in Central and South America being a key asset in the transition.
The transaction is anticipated to complete in Q1 2025, subject to the satisfaction or waiver of the conditions outlined in the arrangement. This move is based on a press release statement.
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