- Bowen Coking Coal (BCB) has entered a trading halt regarding the Bluff PCI Mine acquisition and a capital raise
- The company recently signed a call and put option agreement to acquire the Queensland-based mine for $5 million plus potential royalty payments
- Bowen Coking Coal says the mine, which is under care and maintenance, is a rare opportunity which can be recommissioned without significant capital expenditure
- All details on the acquisition and capital raise should be released by November 11 when the company comes out of the trading halt
- Company shares last traded at 17 cents on November 8
Bowen Coking Coal (BCB) has entered a trading halt regarding the Bluff PCI Mine acquisition and a capital raise.
Last month, the company announced it secured a call option and granted a put option to MACA to acquire the assets of the Bluff PCI Coal Mine for $5 million-plus potential royalty payments.
As part of the terms, Bowen had between November 6 and 9 to exercise the call option and if not exercised, MACA can affect the sale through its put option within a further three business days.
Put simply, a call option gives the holder the right to buy a stock and a put option gives the holder the right to sell a stock.
The Bluff mine is located in the Bowen Basin of Queensland and has been under care and maintenance since the end of last year. It’s expected to cost between $5 and $7 million to restart the mine, with $6 to $9 million estimated in total for the first $12 months.
Executive Chairman Nick Jorss commented on the acquisition.
“Bluff is a rare opportunity to acquire a near production asset which can be recommissioned without significant capital expenditure,” he said.
“The acquisition of the Bluff PCI mine accelerates our goal of becoming the Bowen Basin’s next independent producer of high-quality metallurgical coal to supply the steel industry worldwide.”
At the time of the option, the company was considering various proposals from debt providers to support the mine restart.
The capital raise may support the acquisition or mine costs, but this hasn’t officially been disclosed.
All details on the acquisition and capital raise should be released by November 11 when the company comes out of the trading halt.
Company shares last traded at 17 cents on November 8.