Philex on lookout for M&A prospects

MANILA, Philippines — Pangilinan-led Philex Mining Corp. said it is on the lookout for mergers and acquisitions in green metals such as nickel.

“We have always been on the lookout for mergers and acquisitions related to other green metals such as nickel, that have not gained much traction,” Philex Mining president and chief executive officer Eulalio Austin Jr. said at the company’s annual stockholders’ meeting yesterday.

The company also said that it remains open to partner with potential investors for the development of its Silangan copper-gold project in Surigao del Norte.

Philex chief finance officer and treasurer Romeo Bachoco said that despite the company already beginning the project on its own, it remains open to strategic partners that are willing to invest in the Silangan project.

“Depending on when the investment will come in, the additional capital from investors will be deployed to either accelerate the ramp up of production capacity or reduce the debt syndication or reduce Philex cash infusion,” Bachoco said.

Philex earlier sought $750 million to start the development of the Silangan project, however it failed to find one largely because of uncertainty in government policy.

This led the company to pursue an in-phase development plan for the Silangan project, where the company would spend an initial $224 million for the development of a starter mine.

Bachoco said earlier that the $224 million funding will be financed by a combination of capital infusion from Philex, equity via stock rights offer (SRO), and debt.

The company will sell up to 842 million shares to existing shareholders at P3.15 per share to raise as much as P2.65 billion.

The offering is targeted to run from July 14 to 25.

Existing shareholders will be entitled to one share for every 5.8674 common shares owned.

The company is set to begin the development of the first phase of the Silangan project this year, which will produce around 2,000 tons of ore per day.

This will be ramped up to 12,000 tons a day or four million tons a year by the 12th year of operations.