① After spending 10 billion dollars each to acquire Yintai Gold and Xiling Gold Mine, Shandong Gold has not stopped on the way to expand its capacity and increase its reserves. ② However, the company did not provide a detailed explanation for the premium valuation of 20 times the ultra-net assets of the proposed acquisition.
Financial Services Association, March 11 (Reporter Liang Xiangcai) After spending 10 billion dollars to seize the proceeds of Yintai Gold (000975.SZ) and Xiling Gold Mine, Shandong Gold has not stopped on the way to expand its capacity and increase reserves, but the company did not provide a detailed explanation of the reason for the premium valuation of 20 times the ultra-net assets of the proposed acquisition.
This evening, Shandong Gold (600547.SH) announced that it plans to acquire 70% of Baotou Changtai Mining Co., Ltd. (hereinafter: Changtai Mining) at a price of about 471 million yuan.
It is worth noting that compared to the 50-page evaluation report when it was announced at the beginning of the year that it plans to acquire prospecting rights at the Xiling Gold Mine for 10.334 billion yuan, the information on Shandong Gold's current acquisition of Changtai Mining was interspersed with a total of 7 pages of relevant board meeting resolutions.
According to the announcement, the asset evaluation uses the asset base method. Changtai Mining's total asset book value is about 73 million yuan, the assessed value is about 725 million yuan, and the assessed value-added rate is 894.44%; the total debt book value is about 43 million yuan, with no increase or decrease after evaluation; and the net asset book value is about 30 million yuan, with an assessed value of 682 million yuan, and a value-added rate of 2203.85%. However, the specific reason for the added value was not explained in the relevant announcement.
Previously, the premium for Shandong Gold's acquisition of Yintai Gold was not tens of times higher. According to the January 19, 2023 announcement, the company obtained 20.93% of Yintai Gold's shares for 12.76 billion yuan. Compared with the average stock trading price of Yintai Gold on the first 20 days up to December 2, 2022 (the day before the announcement of the suspension of trading of Yintai Gold), this premium level includes a control premium, as well as premiums paid by considering Yintai Gold's resource reserves, development prospects, and potential future synergies.
According to reports, the core assets of Changtai Mining are mining rights and prospecting rights for the Tauragai Gold Mine. According to the announcement, according to relevant mineral exploration reports, as of June 30, 2023, mining rights and prospecting rights at the Tauragai gold mine were valued at 677 million yuan using the discounted cash flow method. The amount of resources available within the assessment range is 3.683 million tons of gold ore, 16,148 kg of gold metal, with an average grade of 4.38 g/ton. The amount of resources available is associated with 3.115 million tons of silver ore, 38,659 kg of silver metal, and an average grade of 12.41 g/ton.
In terms of production capacity, Changtai Mining has built a beneficiation plant with an actual production capacity of 200 tons/day and a tailings depot. Approximately 400 kg of gold is expected to be produced in 2024.
Regarding the significance of this acquisition, Shandong Gold also mentioned at the end of the announcement that after the acquisition is completed, the company will add more than 16 tons of gold resources, and through prospecting to increase storage, the amount of gold resources it holds is expected to increase to more than 20 tons by the end of 2024. Changtai Mining's production system is relatively complete, and increasing production capacity will add one ton of gold mines to the company. Through this acquisition, the company will achieve a strategic layout with resources from scratch in western Inner Mongolia, which is conducive to building a new gold and mineral resource development base.