Shares in Metals One PLC (AIM:MET1) rose 5% to 2.05p after the company flagged a potentially significant move by one of its investee businesses in South Africa’s gold sector.
The AIM-listed group said Lions Bay Resources, an associate of Lions Bay Capital, has made an offer for all the assets of Vantage Goldfields.
Metals One owns 19.1% of Lions Bay Capital and 5% of Lions Bay Resources, alongside convertible loan notes that could lift its interest in Lions Bay Resources to at least 30% on a fully diluted basis.
The bid values the Vantage assets at C$46.5 million, structured as an upfront cash payment, a share-based component and a royalty linked to future gold revenues.
Vantage owns a package of mining leases in South Africa’s Barberton region and was placed into business rescue in 2016 following a fatal collapse at the Lily mine.
Daniel Maling, managing director of Metals One, said the proposal marked “an exciting step” towards building a vertically integrated gold business, adding that Metals One could “create significant value for its shareholders” if the transaction proceeds.