MINER, Metallon Corporation has partnered with the Nasdaq listed American special purpose acquisition company, Hennessy Capital Investment Corp. VI , to raise capital under a newly formed entity, Namib Minerals (Namib), on the Nasdaq.
Listing on the Nasdaq would allow Namib access to several capital raising initiatives on the bourse as the platform had a total valuation of US$23,41 trillion as of February.
Namib owns three gold mines, several exploration properties and claims in Zimbabwe, acquired from Metallon Corporation Limited, a privately owned investment company founded by Mzi Khumalo in 2001 where he purchased the assets in Zimbabwe from Lonmin in 2002.
The three mines under Namib are Mazowe Mine, Redwing Mine, and How Mine.
“The proposed business combination (partnership) implies a pro forma combined enterprise value of PubCo US$609 million, excluding additional earnout consideration, on a cash-free and debt-free basis, assuming no further redemptions of HCVI’s public shares and US$60 million in targeted PIPE funding to be obtained prior to the Closing,” Hennessy said, in a statement.
“The boards of directors of both HCVI and Namib have approved the proposed transaction, which is expected to be completed in the fourth quarter of 2024, subject to, among other things, the approvals by stockholders of HCVI and Namib and satisfaction or waiver of the other conditions set forth in the business combination agreement.”
Namib told Standardbusiness that the deal followed various initiatives to bring investment into the business.
“In the first quarter of the year 2024, the shareholders of How Mine, Redwing Mine, and Mazowe Mine announced a strategic plan to restore sustainable mining at Redwing and Mazowe, and increasing production at How Mine,” Namib said.
“We are pleased to provide the following update; As previously communicated, the shareholders of How, Mazowe and Redwing mines have been diligently exploring various investment options to propel these operations into a new phase of growth.”
“The transaction strongly positions the two mines, Redwing and Mazowe, to resume operations, while scaling up production at How Mine.”
According to the firm, the completion of the transaction is subject to regulatory approvals.
“The transaction further demonstrates the attractiveness of Zimbabwe’s mining sector to international capital markets, thereby offering more economic opportunities for the country,” Namib added.
Hennessy reported the proposed business combination consideration of approximately 50 million Namib ordinary shares values the miner at a pre-money enterprise value of US$500 million.
This is with up to an additional 30 million Namib ordinary shares tied to the completion of operational milestones, including the commercial production of the Mazowe and Redwing mines.
“The proposed business combination is expected to deliver net proceeds to Namib of approximately US$91 million, assuming no further redemptions by HCVI’s public stockholders, as well as approximately US$60 million of additional funding from one or more financing agreements with investors expected to be executed prior to the closing,” Hennessy said.
“As a result of the proposed business combination, Namib expects to benefit from continued operational efficiency and cash flow generation from its producing How Mine and the build-out of Namib’s multi-asset growth path.”
The American firm added that the proposed business combination also represented the largest African deSPAC to date. De-SPAC refers to the process where a private company goes public by merging with a special purpose acquisition company (SPAC).
Namib’s existing management team, led by chief executive officer, Ibrahima Tall, is expected to continue leading the business after the closing of the partnership.
“We are extremely pleased to announce our business combination with Namib, an established gold-mining company in the sub-Saharan mining industry.
“HCVI was formed with the objectives of merging with an established and competitive company operating in the industrial or energy-transition sector,” Hennessy chairman and CEO Daniel Hennessy said.
“Namib stood out as a compelling partner due to its history of underground mining in precious metals, opportunities for future expansion and its mission to create safe, sustainable and profitable operations in the communities it serves.”
He added: “We look forward to collaborating with Ibrahima and his team of veterans in the mining industry, as Namib continues to grow and create shareholder value.”