NH Ceramics' acquisition of Blackgold is nearly completed

SINGAPORE - The building materials supplier NH Ceramics is closer to completing the reverse take-over of BlackGold, with the new entity set to list on the Catalist Board by next month.

The deal has been in the making since March 2013, when Singapore-listed NH Ceramics announced its interest in venturing into Indonesia's coal mining industry.

It then entered an agreement with five vendors - Twin Gold Ventures, Rockfield Lake, Cerenti Investments, Novel Creation Holdings and Kaalasona - to acquire BlackGold via a reverse takeover.

This involves the buyer issuing shares to the seller. In NH Ceramics' case, it plans to issue 635,593,220 shares - on a post-share consolidation basis - at 29.5 cents each to the five vendors and UOB Kay Hian, which is advising on the deal.

This prices the transaction at around $187.5 million.

UOB Kay Hian is paid in shares for advising the transaction.

The move was approved by NH Ceramics shareholders in an extraordinary general meeting last week. They also backed a a proposal to rename the firm BlackGold Natural Resources Limited. It has control of about 48,910ha of coal concessions in Sumatra's Riau province.

The share issue will give the five vendors and UOB Kay Hian a combined stake in NH Ceramics of approximately 90.5 per cent. A placement exercise will be undertaken to allow the company to meet the shareholding spread and distribution requirements under the Catalist rules as well as to raise capital to finance building and developing mines on BlackGold's three concessions in Indonesia.

Mr Intekhab Khan, BlackGold's non-executive chairman, told the Straits Times that the placement exercise is already underway to pave the way for the Catalist listing in late February or early March.

"The addition of BlackGold to Catalist will offer local investors the opportunity to benefit from Indonesia's robust energy sector," he added.

"As Indonesia is a resource-rich nation with a growing domestic demand for energy, we are confident that BlackGold's assets and corporate strategy will create future value for our new shareholding base."

Indonesia's electrification rate is set to grow by 8.4 per cent annually from 2013 to 2022. Against this backdrop, BlackGold will prioritise producing coal as a power plant fuel specifically in Riau, where the local electrification rate is behind the national average.

whwong@sph.com.sg