The Bahvest group will continue its fish farming operations although it is deepening its involvement in mining.
KUALA LUMPUR: Borneo Aqua Harvest Bhd (Bahvest) has proposed to deepen its involvement in mining and mining-related businesses through the purchase of the entire equity interest of Wullersdorf Resources Sdn Bhd (WRSB) for RM131mil.
The Sabah-based marine aquaculture company told Bursa Malaysia that it planned to pay the vendors, who include Bahvest managing director/CEO Datuk Lo Fui Ming (owner of 70% in WRSB) by issuing 104.53 million new Bahvest shares and 34.84 million irredeemable convertible preference shares at an issue price of 94 sen each.
On Oct 1, WRSB entered into a sub-lease agreement with Southsea Gold Sdn Bhd (SGSB), a company with common shareholders as WRSB that has a four-year prospecting licence ending Dec 31, 2016 to prospect and explore minerals - namely zinc, lead, copper, gold, silver and other base metals - on 20,000ha in Tawau, Sabah.
Under the sublease agreement, SGSB will sub-lease to WRSB 317.7ha in Tawau (representing a portion of the 1,000ha leased from the Sabah Lands and Surveys Department until Dec 31, 2048) for 33 years for an annual rent of RM60,000.
Bahvest said WRSB would have an initial mining right over 28ha, with the mineral resources therein (comprising gold, silver and copper) indicated by Australia-based independent mining consulting company Optiro Pty Ltd.
WRSB plans to systematically explore and prospect the remaining sub-lease area on completion of the proposed acquisition by Bahvest.
This is not the first time the Bahvest group is venturing into mining,
In June 2013 Bahvest had entered into a co-operative agreement with SGSB in relation to the prospecting, exploration and extraction of various minerals and commercialisation of such minerals on 200 acres in Bukit Mantri, Tawau.
During the last financial year ended March 31, 2015, the group incurred a cost of RM0.954mil for the prospecting and exploration of minerals.
Bahvest, which posted a pre-tax loss of RM4.566mil for the 2015 financial year, said WRSB’s estimated initial capital expenditure and operating expenses for the first two years totalled about RM30mil.
Bahvest plans to raise the money via a combination of internally generated funds, bank borrowings and/or shareholder’s advances.
The Bahvest group intends to continue with its existing core businesses of rearing marine fish and marketing fishes/fish products while undertaking the mining business through WRSB.
Bahvest shares were on trading suspension from 2:30pm on Thursday to 5pm on Friday on Bahvest’s request, pending the above announcement. On Thursday, its shares were last traded at RM1.19, up 26.6% from the preceding day’s final price of 94 sen.
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