MANILA, Philippines — Listed Global Ferronickel Holdings Inc. (FNI) is eyeing to acquire a 20 percent interest in a Chinese ore value-added processor.
In a disclosure to the Philippine Stock Exchange, FNI said its board is considering the proposal of the management to acquire a stake in Guangdong Century Tsingshan Nickel Industry Co., Ltd. (GCTN).
FNI said the transaction would enhance the synergy between the company as ore supplier and GCTN as value-added processor, which will provide consistent and reliable trade transactions between the parties.
The deal will also support the diversification projects of FNI.
FNI, through its subsidiary Platinum Group Metals Corp. (PGMC), previously supplied medium grade saprolite ore to the Chinese company.
The two companies first signed supply contracts in 2014.
FNI’s board has appointed Punongbayan & Araullo Grant Thornton, an external independent party accredited by the Philippine Stock Exchange and Securities and Exchange Commission of the Philippines, to issue fairness and valuation reports for the company’s material related transaction.
It has also given the authority to its audit, risk and related party transaction committee to ensure that the terms and conditions of the acquisition comply with the requirements applicable to material related party transactions and that the rights of the shareholders and other stakeholders are protected.
“Definitive agreements will be executed in due course,” the company said.
Last March, FNI said it was targeting a nickel ore shipment volume of six million wet metric tons (WMT) for this year’s mining season with the opening of a mining area in its Cagdianao site.
Its operating arm in Surigao del Norte, PGMC commenced shipment of nickel ore to its customers in China on March 29,2021.
FNI president Dante Bravo earlier said the company was confident of hitting its target with the opening of CAGA 1, which is expected to boost capacity by 10 percent.
The opening of CAGA 1, together with CAGA 2, CAGA 3 and CAGA 4, brings to four the operational mining areas of PGMC.
FNI’s mine site in Surigao is subdivided into seven Cagdianao areas. In 2019, the company opened its CAGA 3 mine area.