LONDON (ShareCast) - (Sharecast News) - UK minerals developer Anglesey Mining has agreed to acquire an additional 29.8% of Grängesberg Iron (GIAB), it announced on Thursday, which owns the Grängesberg iron ore project in Sweden.
The AIM-traded firm said the acquisition would take its stake to 49.75%.

It said it had agreed with Roslagen Resources to purchase Roslagen's 29.8% stake in GIAB, as well as the assignment to Anglesey of 40% of the outstanding subordinated debt owed to Roslagen by GIAB with a nominal value of £0.34m, for total consideration of £0.53m.

The acquisition would be satisfied through a cash payment on completion of SEK 1.09m (£87,000), funded from the company's existing resources, as well as the issue to Roslagen of 14,544,827 new Anglesey shares at a price of 3p each, to be held in escrow for 12 months from issue.

At the closing of the transaction, Roslagen would hold 4.9% of the expanded capital of Anglesey, and would also continue to hold around SEK 6.28m in subordinated debt due from GIAB.

Anglesey has a right of first refusal over the remaining 50.25% of GIAB, and Roslagen director and shareholder Andreas Simoncic would remain on the Board of GIAB.

"We are very excited to agree this transaction with Roslagen, increasing Anglesey's holding in Grängesberg," said chief executive officer Jo Battershill.

"We are also very pleased to retain the services of Andreas Simoncic on the board of GIAB and welcome Roslagen's ongoing involvement as an Anglesey shareholder.

"Andreas' long history with the project will be an important component in moving Grängesberg forward."

Battershill said the company still believed the Grängesberg project had the potential to be restarted as "one of Europe's largest" individual producers of iron ore concentrates.

"When combined with the high-grade nature of the concentrate and proximity to European steel mills, the asset clearly demonstrates highly strategic positioning.

"As we have previously communicated, the opportunity for Anglesey Mining is now to advance the project through to a Financial Investment Decision."

That could be completed along with securing a strategic investor, offtake partner, separate listing, or a combination of those options, Jo Battershill explained.

"However, we recognise that there is still a lot of work to complete at Grängesberg, including updating both the resource and reserve models and undertaking environmental assessment studies as preliminary steps to preparing a feasibility study."

At 1400 GMT, shares in Anglesey Mining were up 2.79% at 2.21p.

Reporting by Josh White for Sharecast.com.

Email this article to a friend

or share it with one of these popular networks:

• DIGG
• FACEBOOK
• STUMBLEUPON
• MIXX
• YAHOO BUZZ
• DELICIOUS
• REDDIT
• NEWSVINE