Denham platform to assume control of Australia-listed miner

Tremont Holdings, a platform backed by Denham, is Cradle’s joint venture partner on the Panda Hill Niobium project and already owns 19.6% of Cradle itself. Tremont will acquire all of the outstanding shares in the company for A$0.33 apiece in cash through a scheme of arrangement. The offer represents a 43.5% premium to the previous closing price, according to a filing.

Cradle shareholders, including company directors, who own a 45.5% stake in the business have agreed to support the proposal. The scheme is expected to be implemented in late June. It will result in Tremont’s effective interest in Panda Hill rising from 59.8% to 100%.

“Tremont’s management team shares our vision for the development of the Panda Hill Niobium Project, and as such, we believe they are the right long-term partner for future customers, employees and other stakeholders in this capital intensive project,” Ian Middlemas, group chairman of Cradle, said in a statement.

Niobium is primarily used in the production of high-strength, low alloy steel. Niobium steel is commonly found in pipelines, cars and structures such as bridges and buildings. According to the World Steel Association, using niobium steel in car engines means that components can be thinner without losing their strength, thereby reducing weight and increasing fuel efficiency.

Niobium super-alloys also have high-temperature applications – including jet engines, gas turbines, rocket subassemblies, and turbocharger systems – and can be used to produce superconducting magnets. The metal has featured in components used in space programs and the Large Hadron Collider.

A definitive feasibility study on Panda Hill was completed in April 2016. It concluded that the asset could generate 1.3 million metric tons of ore per year in its first four years, rising to 2.6 million tons per annum thereafter. The proved and probable reserves amount to 20.6 million tons, which implies 139,640 tons of niobium oxide. The estimated initial construction cost for the project is $196 million, excluding working capital.

Tremont is an Africa-focused investment platform Denham established in 2011 in conjunction with South Africa’s Pangea Exploration. The private equity firm provided $200 million in seed funding. Denham has made similar platform-style investments in the likes of Pembroke Resources and Auctus Minerals in the mining space as well as Nexif Energy for renewables in Southeast Asia.

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Save this article  
• Send to  

• Topics
• Australasia
• Industrials
• Buyouts
• Australia
• Africa
• Commodities
• Denham Capital
• resources