Lemur Resources (ASX:LMR) has scope to make a “company making” acquisition according to 54% shareholder Bushveld Minerals (LON:BMN), due to it currently sitting on around US$16.5 million of cash.
The assessment of the ASX-listed group’s prospects was contained in a strategic review carried out by Bushveld, which follows the protracted takeover of the Madagascar-focused coal business.
Bushveld is currently sitting on just over 54% of Lemur’s shares, and said on Tuesday it would continue the Australian listing for the time being at least.
It also confirmed that Bushveld founder director Anthony Viljoen will become permanent chief executive, after previously holding the role on a temporary basis.
The review has concluded there are significant savings to be made moving Lemur’s operational and financial base from Perth to Johannesburg, where Bushveld is based.
Bushveld chief executive (CEO) Fortune Mojapelo explained: "Relocating the office to Johannesburg will allow for a combination of the respective technical teams and a more efficient corporate structure.”
The AIM-listed tin and iron group said it continued to be supportive of Lemur’s plans to develop the Imaloto Coal Project in Madagascar.
It said the recent elections on the island suggest the political environment is stabilising.
The first phase of the open pit could be in production for as little as US$12 million. However, the plan is to develop it as an independent power project, which requires securing a licence for a plant and a partner as co-developer.
Finally, Bushveld said Lemur’s US$16.5 million of cash puts in a strong position to have its pick of prime Africa-focused projects at distressed prices ranging from the earlier stage to the producing.
CEO Fortune Mojapelo added: “We look forward to updating the market as appropriate in deploying Lemur's cash resources in undervalued opportunities in Africa."
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