Macquarie Bank invests P312M in Nihao

MANILA, Philippines - Australia’s Macquarie Bank Ltd. has acquired an initial 33 million shares of listed mining firm Nihao Mineral Resources International Inc. for P312.18 million.

In a disclosure to the Philippine Stock Exchange yesterday, Nihao said it sold the shares at P9.46 each. The acquisition forms part of a private placement deal involving up to 150 million common shares.

Under the agreement dated Feb. 11, Macquarie Bank would invest between $25 million and $30 million in Nihao via a private placement.

The shares to be issued will come from Nihao’s authorized but unissued capital stock. 

The purchase will be done in tranches over a period of one year from the execution of the agreement.

Nihao expects to raise around P1.417 billion from the private placement which it intends to use to fund working capital requirements and the acquisition of mining rights and contracting of mining and port operations.

“Amounts raised from the private placement will equip the company with adequate financial and logistical support to enable it to undertake full-scale operations and development in the mining sector,” Nihao said.

“Once the projects are operational, a steady income stream may be realized. Over time, ultimate benefit to shareholders is expected as shareholders’ value will be enhanced,” Nihao added.

Nihao’s share price has more than doubled since the start of the year.

The company formed a joint venture with AGP Industrial Corp. and global commodity trading giant Glencore International AG to identify and develop mines in the Philippines and other countries in the region such as Indonesia.

The joint venture, GNA Resources International Ltd., was established in Hong Kong.

Nihao and AGP will take charge of mining, contracting and developing the mines in the country while Glencore will contribute its expertise in marketing nickel ores in the world market using its network of various institutions overseas.

In the first nine months of 2011, Nihao posted a net income of almost P24 million or more than 10 times what it earned in the same period a year earlier.