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Bilboes plans IPO in 2016

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BILBOES Holdings, a local privately-owned predominantly gold mining company, plans to make an initial public offer next year to raise at least $7,4 million for further development of its mines.

According to a recent presentation to investors, Bilboes requires $2,5 million to recapitalise oxide operations, $2,7 million for sulphide pre-feasibility and $2,4 million for sulphide definitive feasibility.

A total of $4,3 million of the funding is required over a period of six months, $1,7 million over four months and the balance of $1,6 million for a period of 18 months, the gold mining entity said.

Bilboes said that it had “Intention to IPO (initial public offering) from 2016 to raise funds for mine development at Isabella-McCays-Bubi (Matabeleland North Province) sulphide complex”.

The group obtained $7 million debt facility in December 2012 from Industrial Development Corporation of South Africa to recapitalise the Oxide Mines and $16 million from private placements in June 2011 and January 2013, for the sulphide project definitive feasibility studies.

London-based Baker Steel Resources Trust had invested a total of $6 million in June 2011. Hong Kong-based Shining Capital invested $10 million in January 2013 to acquire shares in the group.

Indigenous firm, GAT Investments owns 52 percent stake in the group while foreign entities Infinite Treasure and Baker Steel hold 25 percent and 23 percent shareholding, respectively.

The group is generating cash in excess of $2 million per annum based on gold price of $1 200/oz.

Isabella-McCays-Bubi Complex (Oxide) has a previous production of 240 000 ounces over a 20-year period. It has current production rate of 11 000 ounces over a potential 10-year life of mine.

The Isabella-McCays-Bubi Complex (Sulphide) SRK assessed joint ore resources committee resource of 4 million oz to 200 metres vertical extent and upside potential on down dip and strike extensions infill drilling and pre-feasibility study is underway with definitive feasibility study completion targeted for the last quarter of this year.

Three production scenarios are being considered; 40 000 oz, 70 000 oz, 100 000 oz per annum of gold at an estimated cost of plus or minus $110 million.

Bilboes is headed by a former Anglo American management team led by chief executive Victor Gapare, a former president of Zimbabwe Chamber of Mines and director of several companies.

Its assets were acquired from Anglo American in 2003 through management buyout.

Fully compliant with indigenisation requirements with approvals for a private placement already in place, 56,80 percent is owned by indigenous parties including management and local community.

Apart from gold exploration and development, Bilboes also has interest in gold quarry and Manicaland claims. SRK derived resource potential of 0,5 to 1,5 million ounces to 300m within claims environment.

Another independent technical report was set for completion by end of 2014.

Further, Bilboes holds significant ground in claims and exclusive prospecting order applications within the Zimbabwe green-stone belts, which the group will seek to exploit in future.

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