LONDON - Metals Exploration plc (AIM: MTL), a mining exploration company, has detailed a possible offer to acquire Condor Gold plc (LON: CNR), with terms indicating a valuation of Condor's existing issued ordinary share capital at approximately £67.5 million. The announcement, made today, clarifies the potential fixed consideration for Condor shareholders, which would include both shares in Metals Exploration and cash.
Each Condor shareholder would receive 4.0526 new Metals Exploration shares and 9.9p in cash for each Condor share held, based on the closing middle-market price per Metals Exploration share as of November 29, 2024. This fixed consideration implies a value of about 33.0p per Condor share.
Additionally, a Contingent Value Right (CVR) would be offered to Condor shareholders, potentially increasing the total consideration. The CVR entitles shareholders to a pro rata share of additional revenue from any new gold resources discovered at Condor's projects beyond the base case Mineral Resource Estimate, capped at 1.6 million ounces over a five-year period. The maximum potential CVR consideration could reach approximately £22.6 million, representing an additional 11.1p per Condor share, bringing the aggregate potential value to roughly 44.1p per Condor share.
The CVRs are complex financial instruments, and their ultimate value will depend on various factors, including the success of additional resource discoveries.
The possible offer is contingent on several conditions and there is no certainty that a firm offer will be made. Metals Exploration has until 5:00 p.m. on December 4, 2024, to announce a firm intention to make an offer under the City Code on Takeovers and Mergers.
Galloway Limited, owned by Jim Mellon, Non-Executive Chair of Condor, has given an irrevocable undertaking to support the acquisition. This undertaking includes Galloway's current holding of 50,512,597 Condor shares, which is approximately 24.7% of the issued share capital, and additional shares that could be issued upon the exercise of warrants held by Galloway.
This report is based on a press release statement and presents the information without endorsement of the claims. The markets will continue to observe the developments surrounding this potential acquisition.
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