PacMin posts profit (September 12, 2001)

Vancouver — The subject of a $170-million takeover target, Teck‘s (TEK-T) Australian gold-mining arm PacMin Mining, tabled a net profit of A$7.2 million for the fiscal year ended June 30.

The company produced 221,039 oz. gold during the year.

The Tarmoola mine contributed 155,447 oz., down from 180,000 oz. in 2000. The newly constructed A$40-million Carosue Dam operation in Western Australia added 65,592 oz.

At June 30, PacMin held a stake in resources totalling 127.7 million tonnes grading 1.72 grams gold per tonne for just over 7 million oz. PacMin’s equity share tallies 6.64 million oz.

The company realized an average gold price of A$537 per oz. in the period. This was some A$36 per oz. above the average spot price over the term.

Last month, gold and tantalum producer Sons of Gwalia (SGW) tabled a $170-million takeover bid for the company.

The share-swap offer would see SGW acquire all of PacMin’s ordinary shares in consideration of five SGW shares for every 28 PacMin shares. The Australian-based company has also offered to acquire all of PacMin’s redeemable converting preference shares, which are held by Teck, for A$6.10 each in cash.

Teck holds 97.45 million shares, or 74% of PacMin ordinary shares, and 7.7 million preferred shares, giving the diversified miner an 80% equity stake in PacMin.

Teck is considering the offer, which is subject to SGW acquiring 90% of PacMin’s shares.