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Acquisition Opportunity

Deadline:
Friday 17 December 2021 at 4pm GMT

Subsidiary of NQ Minerals Plc (in Administration)

Hilco Streambank and Hilco Valuation Services Europe (“Hilco”) are seeking offers to acquire BVI registered Keen Pacific Limited, a subsidiary of NQ Minerals Plc (In Administration) (“NQ Minerals” or the “Company”). Hilco is conducting the sale process on behalf of the Joint Administrators of the Company, Paul Cooper and Paul Appleton of Begbies Traynor Group Plc.

Background

Established in 2013, NQ Minerals is an Australian mining company focused on the environmental rehabilitation of former precious metal mining operations and the sustainable extraction of minerals required to deliver clean energy and a low carbon economy. NQ Minerals is listed on the London Aquis stock exchange and the US OTCMarket.

As the parent of the corporate group (the “Group”), NQ Minerals holds shares in Keen Pacific Limited BVI, which holds the shares of additional subsidiaries (see below). In the last 3 years, the Group has generated overall revenues of c. £78m.

NQ Minerals owns 100% of Keen Pacific Limited BVI, which owns 100% of Ivy Resources Pty Ltd, which in turn owns Hellyer Gold Mines Pty Ltd and Pieman Resources Pty Ltd. The latter of these subsidiaries own the operational assets of the Group.

The Group has full operational control of two mining sites at Hellyer and Beaconsfield (Hellyer currently being fully operational) with off-take agreements in place for 100% of lead and zinc concentrates production through to the end of the LOM in 2027, albeit this is contingent on the successful conversion of material into a Reserve from 2025 onwards.

The Hellyer mine in 2020 had 1.4 million tonnes extracted which produced a gross profit of $63 million (AUS). A JORC compliant resource estimate was taken in 2012 which estimated approximately 9.25 million tonnes of tailings comprising around 2.35% zinc, 2.99% lead, 92 grams per tonne of silver and 2.57 grams per tonne of gold. The JORC resource estimate is further complemented and confirmed by detailed production records that were kept during the period of mine production, which indicate 11.25 million tonnes of tailings in total.

The Beaconsfield site has a programme for recommissioning plant and equipment and has full permissions granted for mining commencement from surface stockpiles. The stocks have been recovered from historical tailings and have been partly brought into a JORC-compliant resource. The mine also offers significant development potential through remnant extraction and mining of untapped resources at depth. A new Mineral Resource report has established that the resource in the lower section of Beaconsfield Gold Mine has increased to 1.454 million tonnes grading 10.3 grams per tonne (g/t) for 483,000 ounces of gold.

In 2019, the Group also made a strategic investment in the Tasmanian mining firm, Tasmania Energy Metals Pty Ltd (“TEM”). The Group and TEM have been jointly developing plans for a combined mining and processing plant in northern Tasmania. This plant would extract gold and silver from the final Hellyer tailings, with by-product sulphuric acid to be utilised to produce cobalt and nickel salts for sale to the electric vehicle battery market.

Opportunity

The offering presents an opportunity to acquire an operational mining site that can produce millions of tonnes in base metals and strong precious metals by-products, along with an opportunity to restart one of Australia’s highest grade gold mines with easy access to gold bearing ore at surface, generating early cashflows. Both sites provide scope for deeper subterranean mining. The Group operates in the highly desirable industrial metals industry with agreements in place through to the end of the LOM. Management advise that Tasmania is a safe jurisdiction with a supportive State government, which is host to a number of large successful mining operations.

Sales Process

Offers are due Friday 17 December 2021 at 4pm GMT.

All expressions of interest and bids are to be directed to Hilco in writing. Please contact Hilco to gain access to a virtual data room of further information on signing a confidentiality agreement.

Key Terms & Conditions

The Joint Administrators acts as an agent of the Company and without personal liability.

The bidder acknowledges that Hilco acts as an agent for the Joint Administrators who offer for sale only what right, title and interest (if any) the Company possesses in the assets. Such sale will be without any warranties, expressed or implied. The information provided has not been verified by Hilco or the Joint Administrators and bidders are deemed to have carried out their own due diligence.

VAT, if applicable, at 20% will be added to the price. A non-refundable deposit will be payable by the buyer within 24 hours of bid acceptance. Legal completion to occur within 5 business days of bid acceptance. Hilco Streambank’s full Terms and Conditions apply.

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