JES International to Acquire Stake in Mineriver

Mainboard – listed JES International Holdings Limited, a major private shipbuilding group based in the PRC, announced that the Group has entered into a conditional investment agreement with Mineriver Pte Ltd. for the acquisition of up to a 30% stake in Mineriver for a total consideration of S$127.0 million.

Mineriver is a Singapore – incorporated company to acquire the entire issued share capital of a Xinjiang Company, which holds mineral exploration rights in the Xinjiang Uygur Autonomous Region, the People’s Republic of China.

The acquisition will be carried out in three tranches. The Group shall obtain 5% in the share capital of Mineriver in tranche 1 for S$7.0 million. Under tranche 2, the Group will acquire 15 .0% Mineriver’s share capital from vendors for an aggregate sum of S$60.0 million. In tranche 3, the Group shall be granted a call option for an additional 10% stake in the share capital of Mineriver at about S$60.0 million. The aggregate consideration of S$127.0 million over three tranches shall be satisfied by cash and issuance of new shares.

SRK Consulting China Ltd has been engaged to prepare the report in respect of the Assets in the Mine Locations, to be prepared in accordance with the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves promulgated by the Joint Ore Reserves Committee of the Australasian Institute of Mining and Metallurgy, Australian Institute of Geoscientists and Minerals Council of Australia (the JORC Report).

Under the conditions precedent of the investment agreement, JES is only expected to proceed with tranche 2 and tranche 3 when the measured and indicated mining value of the assets (excluding inferred) is not less than S$60 billion. Mineriver considers making an application for future listing on a recognised stock exchange to be determined in due course.

“The signing of the investment agreement is an important step towards the realisation of our overall Group strategy, which is to increase our earnings stream that is independent of the cyclical effect in the shipbuilding industry. Although the investment is still in its preliminary stages, we are excited at the opportunity to be involved early in the project due to the higher potential returns. We look forward to updating shareholders with more details of the project’s prospects upon release of the JORC report from SRK,” Mr. Jin Xin, Chairman and Chief Executive Officer  of JES said.

[mappress]
Press Release, November 5, 2013