Philex buys Anglo interest, gains control of Boyongan

Philex Mining Co., the country’s largest and oldest mining firm, has bought the 50- percent stake of both Anglo American Exploration BV and Anglo American Exploration (Philippines) Inc. in the Boyongan copper-gold project in Surigao del Norte province.

Philex Mining said in a disclosure to the stock exchange that the acquisition, valued at $55 million, would enable the mining company, along with unit Philex Gold Philippines Inc., to gain full control over the property. Philex Mining owns 81 percent of Philex Gold.

Philex completed the acquisition by purchasing the shares of Anglo in its joint venture companies, Silangan Mindanao Mining Co. Inc and Silangan Mindanao Exploration Co. Inc., and the acquisition of assets, receivables, and rights and obligations of Anglo American and Anglo Philippines.

“These pave the way for the continued development of Boyongan and the adjacent areas expeditiously and for the best interest of Philex,” Philex said.

Philex earlier announced its plan to buy out its joint venture partner Anglo American amid a dispute over the results of a pre-feasibility study on the project.

The study conducted by Anglo said “a mining operation based on the currently defined resources, proposed mining and processing methods, assumed long term copper and gold prices and estimated capital and operating costs could not provide an acceptable rate on return on the project investment.”

Philex Gold said Anglo’s study stated that out of the current resource inventory of 210 million tons at Boyongan, only about 87 million tons at 0.68 percent copper and 1.06 grams per ton gold could be reported as a mineral resource by virtue of having “reasonable prospects of eventual economic extraction.”

Philex Gold disputed the assumptions and conclusions made by Anglo in the pre-feasibility study.

Hong Kong conglomerate First Pacific Co. Ltd. in November acquired 20.06-percent stake in Philex Mining for P6.16 billion.

Philex sold 778.62 million shares, representing 20.06 percent of its total issued shares, to Asia Link B.V., which is wholly owned by First Pacific, at P7.92 per share.

First Pacific acquired the shares after state pension fund Social Securities System and other shareholders did not exercise their preemptive rights. SSS, which owns over 18 percent interest of Philex, earlier opposed the buy-in deal between Philex and First Pacific, saying existing shareholders should have the pre-emptive right to buy the shares. (Jenniffer B. Austria, M. Standard)

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