Malaysia Smelting Corporation Bhd (MSC) yesterday announced an agreement with Metal Resources Capital Ltd (MERC) which could substantially increase its access to tin reserves on Bangka island, Indonesia. MERC is owned by an Indonesian based group principally involved in mineral and resource development.
Under a heads of agreement signed on 16 August, the two companies plan to merge MSC’s stake in PT Koba Tin with MERC’s tin concessions on the island, adding some 19,900 hectares containing potential new tin reserves to the 41,680 hectares covered by Koba’s existing contract of work. MERC will also assist MSC in seeking to extend the Koba contract of work for another 10 years beyond its current 2013 expiry, as well as acting as an intermediary in all dealings with the Indonesian authorities.
In a statement to the Bursa Malaysia, MSC said that the partners would form a new company, “Newco”, which would in due course be listed on a recognised stock exchange. Newco would combine the assets of Bemban Corporation Ltd (BCL), through which MSC controls its 75% stake in Koba, and MERC. Both BCL and MERC are private companies registered in the British Virgin Islands. The strategic agreement is expected to be finalised within three months.
