Myanmar Metals said that its board has decided to either sell the company or its stake in the Bawdwin project in Myanmar owing to the political unrest in the Southeast Asian country.
Headquartered in Australia, the company has a stake of 51% in the Bawdwin silver-lead-zinc project. It has also been engaged in building a portfolio of precious and base metals exploration projects in Myanmar.
However, the company has been forced to carry out a detailed review of its assets and operations in the country owing to the state of emergency declared following a military coup.
The company said that although Bawdwin is a world class asset, procuring project finance for it in the near terms will be highly problematic due to the prevailing political situation.
Myanmar Metals added that since the state of emergency, all the parties, which had earlier expressed interest in financing the project, have pulled out.
The company said that it is not possible for it to raise capital for the project at a reasonable cost. The Bawdwin project is estimated to need a pre-production capital of more than $300m, said the company.
According to Myanmar Metals, a process has already been launched to assess international and Myanmar in-country interests in buying its stake in the Bawdwin project. However, the company added that it cannot assure of executing a divestment or confirm the valuation and time frame of any potential deal.
The company said that it has received a takeover offer of AUD66.5m ($48.57m) from China-based Yintai Gold. In this connection, the company is working with Yintai Gold to enable a due diligence process by the latter.
Myanmar Metals executive chairman and CEO John Lamb said: “Shareholders will note from the Yintai proposal that we have been actively seeking to secure a divestment outcome.
“We will continue to pursue the most favourable outcome for shareholders.
“Obviously, we would all have preferred that we were able to continue with our plans to develop Bawdwin, but we have to respond to the circumstances with which we are faced.”
