Metal Tiger PLC (AIM:MTR, OTC:MRTTF, FRA:EBRA, ASX:MTR) said it intends to take up a substantial part of its entitlement in Sandfire Resources's latest institutional placing.
Last week, ASX-listed Sandfire announced the A$1.9bn (£1bn) acquisition of the Minas De Aguas Teñidas (MATSA) mining complex in Spain alongside a A$1.25bn equity raising.
The transaction will immediately transform Sandfire into one of Australia’s largest copper focussed producers with pro-forma production next year of between 170-194,000 tonnes.
AIM-listed Metal Tiger said it will take up its placing entitlement in regard of 3.3mln Sandfire shares, a commitment that will cost it A$17.8mln (£9.4mln).
The settlement date for the placing is 4 October 2021.
In a statement, Metal Tiger said it is currently exploring several options to finance the investment, which may include a new margin loan facility or the existing equity derivative financing arrangement with a global investment bank.
Given its current cash resources and existing liquid equity portfolio, including the Sandfire shares, the board said Metal Tiger has adequate cash and short-term realisable assets to meet the commitment.
Metal Tiger is currently interested in 6.143mln Sandfire shares representing approximately 3.4% of the issued share capital, though, of this holding, around 2.84mln shares are subject to an equity derivative financing arrangement with a global investment bank.
Separately, Metal Tiger also noted the release of Cobre Limited’s latest annual report.
Currently, MTR has a 16.62%, which will rise to 21% if shareholders agree to it taking part in Cobre's latest fundraise.