Comprehensive M&A data with integrated detailed company information

China Hanking to sell Australian ops
Posted on Thursday, 16 February 2017 12:04
The controlling Chinese shareholder of the bidder for half of Kalgoorlie’s Super Pit is close to getting its hands on yet another Australian gold mine after winning an auction for China Hanking Holding’s subsidiary in the country.

Shandong Tianye Real Estate Development tabled a bid which gave the Western Australia-based operator of the Southern Cross mine for an enterprise value of AUD 330.00 million (USD 253.32 million).

The offer made by the property-to-venture capital conglomerate’s newly-incorporated local subsidiary equates to a purchase price of AUD 252.00 million after taking into account external and intra-group debt.

Established in December 2012, Hanking Australia is mainly focused on gold mining, with 246 exploration and mining licenses, and full infrastructure facilities for the excavation, transportation, and processing of gold ore and/or dore.

The subsidiary acquired the mothballed Southern Cross operations, which was not producing and on care and maintenance, from St Barbara in April 2013 for AUD 22.50 million.

Since the deal, Hanking Australia has sunk some AUD 136.00 million to get the asset up and running by February 2015, followed by commercial production that August.

This has resulted in resources almost doubling to 4.57 million ounces of gold from 2.41 million at the time of the acquisition.

Hanking first mooted a possible spin-off and separate listing of certain gold mining businesses on the Australian Securities Exchange in March 2016, though it quickly changed this to include other options such as a divestment.

The international resource exploration and processing group is planning to use proceeds from the sale to improve its capital structure and pay down debt, and to invest in its Chinese iron ore operations and its Indonesian nickel unit.

Shandong Tianye is the founder and the largest and controlling shareholder of Shanghai-listed, diversified conglomerate Shandong Tyan Home, which has a market capitalisation of roughly AUD 2.33 billion.

It owns 29.4 per cent of this property-to-mining investor attempting to secure the acquisition of Barrick Gold’s 50.0 per cent stake in Kalgoorlie Consolidated Gold Mines after offering a reported USD 1.30 billion.

© Zephus Ltd