Assmang to Acquire 19.9 percent Stake in Gabon Iron Ore

Assmang, a metal company owned by Assore and African Rainbow Minerals (ARM), has signed a share subscription agreement to acquire 19.9 percent equity interest in Australia-based IronRidge Resources for £11.74 million ($19.8 million).  While the deal is still subject to £25m ($42.1 million) capital sourcing and the approval of IronRidge to the Alternative Investment Market of the London Stock Exchange, it is expected to open more mineral exploiting opportunities for Gabon.

A statement signed by the Assore and ARM boards of directors said the deal “offers Assmang exposure to some of West Africa’s promising iron ore opportunities and could facilitate Assmang’s long-term access to high-grade iron ore with competitive capital and operating costs.”

Assore and ARM’s investment objectives are to evaluate, secure and develop long-term, value-enhancing and strategic investments. The investment in IronRidge is motivated by the current exploration of its iron ore prospecting licenses in Gabon.  Assore’s Group Manager of new business, Alistair McAdam, however said that while this is Assmang’s first move into iron ore outside South Africa, the decision has nothing to do with concerns about possible future logistical constraints in its home country.

He said, “It is about the long-term growth of the company.”  With focus on iron ore exploration, IronRidge holds three prospecting licenses in Gabon, covering about 5352km².  The Tchibanga and Tchibanga North licence areas are about 60km from the port of Mayumba while the Belinga Sud licence area lies within 140km of Booue on the Trans-Gabon railway.

DGR Global, owner of IronRidge resources said Assmang would be a “strong cornerstone investor” for IronRidge’s IPO, and extend DGR’s international reach.  After the deal goes through, DGR Global’s 45.8 percent stake in IronRidge will be reduced to 26.4 percent.

Source: Ventures Africa