Background: Hartawan Holdings is a Catalist-listed
property leasing and hospitality group in Singapore. It
owns a number of small office buildings and a
boutique hotel in Chinatown. The group is currently
undertaking a restructuring exercise that will entail the
acquisition of an Indonesian gold mining group and
the disposal of its property holding companies.
Reverse takeover: To satisfy the purchase consolidation of S$300m, Hartawan intends to issue and allot 1.5b new shares to the vendors at an issue price of $0.20 per share. This will give the vendors a combined stake of 68.8% in the group upon completion of the proposed acquisition. The issue price is a 40% premium over the stock’s last traded price and four times its NAV.
Reverse takeover: To satisfy the purchase consolidation of S$300m, Hartawan intends to issue and allot 1.5b new shares to the vendors at an issue price of $0.20 per share. This will give the vendors a combined stake of 68.8% in the group upon completion of the proposed acquisition. The issue price is a 40% premium over the stock’s last traded price and four times its NAV.
Switch to gold mining and producing.
Hartawan’s hospitality and property leasing businesses have been incurring losses and will continue to face challenges in the future. The proposed acquisition would enable the company to transform itself into a gold mine owner and producer to take advantage of the high commercial value of gold.
Huge gold mine beckons. For the acquisition to be successfully completed, the key conditions to be met include the issue of a JORC report stating the measurement of the gold reserves at the sites and the commencement of gold ore extraction by May this year. The gold mines are expected to yield not less than two million troy ounces of gold. Based on today’s gold price, the gold reserves could be worth S$3.2b. In comparison, Hartawan’s current market capitalisation is only S$116m.
One of few gold mine players. If the reverse takeover eventuates, Hartawan will join the ranks of the few gold mine players listed on the SGX, ie, CNMC Goldmine Holdings and Liongold Corp, whose stocks have performed well on the back of ever-rising gold and mineral prices. But, a note of caution, execution risks for gold extraction and production are high.
Hartawan’s hospitality and property leasing businesses have been incurring losses and will continue to face challenges in the future. The proposed acquisition would enable the company to transform itself into a gold mine owner and producer to take advantage of the high commercial value of gold.
Huge gold mine beckons. For the acquisition to be successfully completed, the key conditions to be met include the issue of a JORC report stating the measurement of the gold reserves at the sites and the commencement of gold ore extraction by May this year. The gold mines are expected to yield not less than two million troy ounces of gold. Based on today’s gold price, the gold reserves could be worth S$3.2b. In comparison, Hartawan’s current market capitalisation is only S$116m.
One of few gold mine players. If the reverse takeover eventuates, Hartawan will join the ranks of the few gold mine players listed on the SGX, ie, CNMC Goldmine Holdings and Liongold Corp, whose stocks have performed well on the back of ever-rising gold and mineral prices. But, a note of caution, execution risks for gold extraction and production are high.
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