ACG Acquisition (LSE: ACG), a brand new firm based by a mining govt who helped create aluminum large Rusal, says it plans to purchase a crucial minerals producer valued at a number of hundred million {dollars} as quickly as potential.
The brand new asset will type the core of ACG, a particular function acquisition firm, or “spac”, chief govt officer Artem Volynet mentioned in an interview. It intends to purchase one other 4 firms in the identical trade over 5 years, he mentioned.
“Our intention is to accumulate a producing asset that we’ll carry to a London itemizing,” Volynet mentioned by cellphone from London this week. “We are going to use it as a base for a roll up or consolidation, one thing that I’ve executed within the aluminum trade.”
The staff at ACG additionally consists of Hendrik Faul, a former CEO of Anglo American’s (LSE: AAL) copper enterprise and Warren Gilman, a former head of CIBC mining funding groups.
ACG prefers to purchase a producer within the inexperienced metals sector, similar to copper, nickel, cobalt or lithium, nevertheless it’s additionally contemplating gold alternatives, Volynet mentioned. He helped elevate Chaarat Gold (LSE: CGH) from early phases to provide 63,000 oz. of gold equal final yr, when he stepped down as its CEO.
ACG is betting inexperienced steel demand will surge much more after a looming recession, driving up commodity costs as nations intensify efforts to succeed in net-zero emissions targets. The worldwide transition to electrical autos and renewable power is broadly forecast to price trillions of {dollars}.
Volynet mentioned he’d like to purchase one or two property, maybe by yr’s finish, because the slowing economic system provides a window of decrease commodity costs and probably cuts acquisition prices. He mentioned he prefers to purchase an anchor producer among the many 38 nations belonging to the Group for Financial Co-operation and Growth , however he’s additionally contemplating Africa and Jap Europe, although not Russia.
“The larger the higher as a result of if it’s a producing asset we are able to additionally make the most of debt as part of the funding for the acquisition,” Volynet mentioned. “Our aim is to do the transaction as shortly as potential.”
The CEO, who led the merger amongst Sual Group, Rusal and Glencore‘s (LSE: GLEN) alumina property to create UC Rusal and its US$2.2-billion preliminary public providing (IPO) in Hong Kong, mentioned he’s in talks with scores of large-pocket buyers eager to listen to what his subsequent targets shall be. Subsequent acquisitions could embody late-stage tasks or small-producing firms with massive tasks, he mentioned.
The corporate has additionally signed a US$100-million forward-purchasing settlement with Geneva-based IXM, the metals-trading subsidiary of Hong Kong- and Shanghai-listed CMOC Group.
“That is successfully a cornerstone dedication into the pipe,” Volynet mentioned. “We tried to scale back the redemption threat that spacs often have.”
ACG’s IPO on Oct. 7 at US$10 per share was oversubscribed in elevating US$125 million, the CEO mentioned.
ACG was buying and selling at US$9.90 on Friday, following a spike on Wednesday to US$10.30. Its market capitalization is US$123.8 million.
