Philippine conglomerate SM Investments Corp said on Friday it will acquire 17.9 percent stake in Atlas Consolidated Mining Corp via a private placement worth $142 million, signaling its entry into the Southeast Asian country's minerals sector.
The buy-in would allow SM, owned by the Philippines' richest man Henry Sy, to take advantage of opportunities in the mining sector, SM chief financial officer Jose Sio said in a statement.
SM will buy a total of 316.2 million shares at 19.56 pesos apiece in Atlas, which is seeking to raise $390 million via equity and convertible notes issues to fund its full takeover of unlisted gold and copper miner Carmen Copper Corp.
The private placement was arranged by BDO Capital Investment Corp, a unit of the SM group's banking arm Banco de Oro Unibank .
Atlas will also issue one-year and five-year convertible notes to Banco de Oro to raise a total $197.8 million. If the notes are all converted into Atlas shares, the SM group would have combined holdings of 33 percent in the miner.
"We are very pleased with the opportunity to be able to make this investment in Atlas at this time," Harley Sy, SM president, said in a statement.
"Atlas is one of the top 20 copper mining companies in the world. It is very well-positioned to take full advantage of its mine site's significant resources to serve its major markets like China and Korea which have a close proximity to the Philippines."
Atlas' Carmen Copper unit operates the 1,674-hectare Toledo mine complex in central Cebu province. The site is estimated to contain about 1.5 billion tonnes of ore, or about 5 million tons of copper.
Carmen Copper plans to spend $200 million to more than double annual capacity to 100,000 tons of copper metal in concentrate in two to three years from the current 42,000 tons. (Reporting by Erik dela Cruz; Editing by Rosemarie Francisco)
