Proactiveinvestors Australia


Astra Resources PLC pending IPO attracts Minevest Consultants to assist with €1 billion underwriting

Wednesday, August 17, 2011 by Proactive Investors

In a major vote of confidence for Astra Mining's technology and strategic plan, New York based Minevest Consultants in conjunction with major international investment banks has agreed to 'unconditionally underwrite' the IPO to the tune of €1 billion.

In a major vote of confidence for Astra Mining's technology and strategic plan, New York based Minevest Consultants in conjunction with major international investment banks has agreed to "unconditionally underwrite" the IPO to the tune of €1 billion.

Astra Mining, an unlisted public Australian diversified mining company, has struck an agreement with a leading New York Corporate Financial and Asset Manager, Minevest Consultants LLC, to underwrite Astra Resources PLC's capital raising.

Astra Mining would be rolled up into Astra Resources PLC.

Astra will have the company's post-listing of shares by Astra Resources PLC "unconditionally" underwritten to the value of €1 billion by Minevest, in conjunction with major international investment banks.

Minevest, who specialise in services to top tier mineral and mining industries, said that they have clearly identified Astra Resources to be a top of the steel and mining markets contender, with clear potential to reach multi-billion dollar corporate earnings status in a short period of time.

The underwriting is only subject to the issuing of the required post-listing prospectus for the share issue and the satisfactory receipt of a valuation of Astra Resources from a top four accounting firm.

However, regardless of the valuation to be received, the underwriting has been set at a minimum of €1.50 per share.

In another move towards finalisation of listing on the Frankfurt Stock Exchange, Astra earlier in the week asked the company's corporate advisors to finalise the listing process.

The advisors, Stepping Stone Equity and Gebo Equity Management, will in conjunction with their German market maker, Renell Wertpapierhandelsbank AG, place the company’s shares on the German exchange.

The company will now begin the rollup of shares into Astra Resources PLC which is expected to list by the end of September 2011 on the Deutsche Börse as approved in the recent EGM of Astra Mining Ltd shareholders.

Minevest Consultants view on Astra Mining

Minevest said that it recognises Astra Resources’s core management’s directive of, “to vertically integrate its mining assets holdings with its T-Steel technology,” while also generating dependable returns from non-T-Steel supporting mining products sales, as a sharp, and proven approach to success.

This cash flow strategy by practice, institutes steady cash flow for the company with exceptional upside potential of T-Steel products.

Minevest anticipates that this cash flow focused management strategy will result in dependable shareholder value with exceptional and predictable upside share value potential.

What is T-Steel

T-Steel is the flagship asset of Astra Mining is the 30% interest in T-Steel along with full management and operational control over the technology.

T-Steel is a patented technology that has been proven to substantially reduce the cost of production, and to significantly strengthen produced steel.

The high value intellectual property in T-Steel has been valued at €4.47 billion on a NPV basis (around A$6.18 billion) by a Top 4 accounting firm and is on the verge of large scale commercialisation.

T-Steel has a strong commercial record (under various code names) in Europe. This has immediate effect in China and India who can increase the strength of steel per capita from existing operations, hence reduce the need of the number of new steel plants.

Monetising T-Steel

Astra’s business plan consists of two ways to monetise this asset, on the one hand they could produce the high quality steel through their DAM steel mill, and on the other hand there is the option to license the technology for a royalty payment per tonne.

The company believes royalty charges in the order of €150 tonne should be achievable.

Astra is in negotiations to acquire the DAM steel mill in Hungary for production of T-Steel at a rate of around 500,000 tonnes per year.

The mill is currently shut down and requires €80 million for refurbishment and €30 million for purchase costs, for a total of €110 million. This compares with acquisition costs of between €500 million to €1 billion for a similar type of facility in Germany.

An off-take agreement for the production of steel is currently underway with a large German steel supplier, with re-commencement of steel production at DAM attracting the full support of the Hungarian Government.


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