On a break

Marksman's Investment Corner is currently on a short break - expect activities to pick up from July 2018 onwards!

Are you for or against the merger between Alliance Minerals Assets Limited and Tawana Resources?

Thursday, April 5, 2018

Proposed Merger of Equals between Alliance Mineral and Tawana Resources

Announcements can be found here.

Key takeaway:
  • Under the proposed merger of equals between Alliance Minerals (SGX: 40F) and Tawana Resources (ASX: TAW), Tawana will become a subsidary of Alliance Minerals, with proforma ownership split 51/49 between Alliance/Tawana shareholders.
  •  The proforma Market Cap post-merger is expected to be ~A$446m and this will place the merged entity in the position of a Mid-Cap producer.
  • Capital raising to take place.
  • In an earlier news, 85% of non-Bald Hill assets such as Cowan will be spun off in a Spinco (no actual name yet), with ownership by existing Tawana shareholders. There will still be a 15% stake by Tawana thereafter prior to the merger. This also translates to the merged entity having ~7.5% stake in these assets.
  • Mark Calderwood (Managing Director of Tawana) will be the Managing Director of the merged entity.
  • Existing Tawana shareholders will receive 1.1 Alliance Mineral shares for every 1 Tawana share exchanged post-merger. Thereafter Tawana will delist.
  • Alliance Mineral to look to listing on ASX as well.
  • The merger is subject to an independent expert concluding the merger is in the best interest of Tawana shareholders.
  • The merger, if successful, is scheduled to complete on October 2018.

My reaction:


The current reaction over at HotCopper forums seems mixed. Let's see what happens over there after a few days. If Tawana shares really plunges on resumption of trading, it could be a good opportunity to accumulate.

As an Alliance Mineral shareholder, this is a pleasant surprise, especially given that we will earn in ownership to the spun-off properties. I guess in a sense, this also answers my previous question about the business directions of Alliance Mineral going forward. Staying vested.

Previously I have talked specifically about Alliance Minerals here:

Disclaimer: The above should not be used as a decision to solicit buy/sell activity. Use all information at your own discretion and DYODD

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