IMX Resources Limited announce that the Foreign Investment Review Board has approved the investment by Sichuan Taifeng in IMX and the Cairn Hill project
The FIRB approval opens the way for Sichuan Taifeng to:
1. Acquire up to 19.9% of IMX through a placement immediately and
2. Acquire 49% of Outback Iron Private Limited, the IMX subsidiary which indirectly holds the Cairn Hill operations and Cairn Hill ML6303, subject to Department of Defense signing the amended access deed.
Mr Duncan McBain MD of IMX said that “IMX has always had a strong belief that FIRB approval would be forthcoming. Fortunately the flexibility that Sichuan Taifeng has demonstrated, by entering into an interim agreement has allowed the commencement of mining prior to FIRB approval. The final approval is, however, very important for IMX as it allows with minor modifications, the original agreement to be implemented thus realizing the full potential from our Cairn Hill projects and placing IMX in an exceptional position for growth.”
He said that with the first magnetite copper ore having been mined and transported to the ROM pad ready for crushing, IMX remains confident that the first shipment will be loaded in Port Adelaide in Q4.
Following FIRB approval and recent shareholders approval, IMX is able to finalize the second placement to Sichuan Taifeng of 21,691,000 shares at 48.4 cents per share to raise USD 10,498,444. On completion of this placement Sichuan Taifeng will have invested USD 25,057,164 to acquire their 19.9% shareholding in IMX. Simultaneously, IMX will also place 7,759,000 shares at 48.4 cents to OZ Minerals Limited to raise an additional USD 3,755,356, which will maintain their original 13.0% shareholding.
Sichuan Taifeng will now invest approximately USD 24 million for a 49% interest in Outback Iron Private Limited, subject only to the finalization of the Chinese National Development and Reform Commission consent now that FIRB approval has been obtained. The first USD 15 million payments is due within 30 days of FIRB approval, the second USD 5 million payment within 60 days, with the balance within 6 months. Sichuan Taifeng will be issued new shares in Outback Iron Pty Ltd once the first payment of AUD 15 million has been received and Sichuan Taifeng will also appoint 2 directors to the Outback Iron board.
With Cairn Hill ML6303 being located within the Woomera Prohibited Area this has resulted in the FIRB process involving the Department of Defense. IMX and Sichuan Taifeng have been in discussions with the Department of Defense which have resulted in their support for the Sichuan Taifeng investment, conditional only on:
1. Sichuan Taifeng agreeing to reduce its holding in Outback Iron from 50% to 49%. Sichuan Taifeng has agreed to this condition and
2. Termite Resources agreeing to vary the access deed, signed in May 2008, in relation to visitors and site staff. Termite Resources has signed the new deed and transitional arrangements, thus allowing the operations at Cairn Hill to proceed uninterrupted. 3. Department of Defense being satisfied that the amended deed is sufficient to protect the national security interests of Australia.
IMX understands that this final condition will be satisfied later today. At that point the conditions in the FIRB approval will all have been satisfied and Sichuan Taifeng will be able to invest into Outback Iron to obtain 49% equity holding.
