The Offer Company has ongoing operations in the Philippines, and has so far demonstrated a good understanding of all challenges and opportunities involved in the Mindoro Nickel project. It has expressed a strong commitment to bring the project forward until completion and operation in a timely fashion. The Offer Company’s principals, based in the Middle East and in South Asia have access to substantial financial resources, needed to bring the project forward and into operation.
The Offer consists of a cash up-front payment to Intex as well as a free carried equity interest of 8% in a fully financed project of up to USD 1 billion of project related expenses. The equity interest of 8% is calculated on an un-leveraged basis and therefore protects Intex on risks related to financing structure and potential dilution as a result of bringing third parties into the project. The parties have agreed to stipulate the main terms of a transaction in a "Heads of Agreement" ("HOA") to be negotiated between now and 9 January 2015. On agreeing the HOA, the parties will enter into a customary period of mutual due diligence and exclusivity whilst at the same time finalizing all definitive agreements required for the transaction.
Based on a staged development, the Mindoro Nickel project is set to produce 12 – 18 ktpa Ni in the first phase with a capex of USD 981 million, and with a corresponding un-leveraged net present value of a fully financed project on completion of approximately USD 2 billion for the first phase and further upside with the development on subsequent phases. The project is strategically located in proximity to the world’s most expansive nickel markets in South East Asia.
It is the Board’s opinion that the Offer as it stands has substantial value to Intex’ shareholders and it is expected that outstanding commercial issues will be clarified on or before the 9 January deadline. Further developments will be announced in due course, as they occur.
