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LONDON (Alliance News) - Bushveld Minerals Ltd Thursday said its loss narrowed in its last financial year, after it launched a takeover of a coal project development company.
The mineral development company posted a pretax loss of GBP416,743 for the year ended February 28, compared with a GBP2.3 million loss a year earlier. Bushveld was boosted by what it called a "bargain purchase on acquisition" of GBP900,540, representing an uplift in the fair value of Lemur Resources Ltd, in which Bushveld acquired a majority stake in May 2013.
Lemur is an Australia-listed coal project development company which owns the Imaloto coal project in Madagascar. The all-scrip offer exchanged three Bushveld shares for every five Lemur shares, valuing Lemur at AUD19.1 million, a 66% premium to Lemur's prior close.
Later on Thursday, Bushveld said it had agreed to buy a further 10 million Lemur shares, increasing its stake in the company to 57.2%, from 52.2% previously.
Bushveld said that during the past year, it articulated a platform-based strategy for developing its diversified portfolio of projects, targeting low cost, scalable projects with a near-term visibility to production and first cash flow generation.
"We are particularly excited about our Bushveld vanadium project for which a scoping study report was announced on July 21, 2014, just eight months after the Bushveld vanadium project was established as a standalone platform," the company said.
The Bushveld vanadium project, in the Limpopo province of South Africa, has a large, JORC-compliant 52 million tonne vanadium mineral resource on the main magnetite layer, consistent along a 5.5 kilometre strike length.
The site has shown world-class vanadium grades in tests, Bushveld said last month, with an average of around 2.0% vanadium in concentrate for a total contained resource of roughly 760,000 tonnes of vanadium.
Financially, the group said it expects that the accelerated programmes on its projects will increase its cash burn rate, which will be funded from one or more of several financing options at the company's disposal.
Looking ahead, the company said it will remain focused on developing each of its platforms beyond the scoping studies, which now "provide increased levels of confidence in our projects and development approach."
Bushveld shares were quoted up 2.0% at 4.18 pence.
By Anthony Tshibangu; anthonytshibangu@alliancenews.com; @AnthonyAllNews
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