Stonewall Resources (ASX: SWJ) is proof that demand for Australian gold companies is alive and well after it fielded an offer from China's Shandong Qixing Iron Tower Company Limited (Shandong) (002359.SZ) for the gold assets of Stonewall Resources.
Shandong is prepared to pay an indicative price of US$140 million or above for Stonewall Mining, a subsidiary of Stonewall Resources.
Stonewall Resources is currently trading at $0.135, the offer from Shandong values it at $0.257 a share based on total shares including restricted, deferred and South African shares.
Stonewall’s key assets are stakes in two South African projects and an Australian one.
The largest is the TGME project, located in the Sabie-Pilgrim’s Rest Goldfield, a district that’s produced an estimated 6 million ounces of gold to date.
In a coup for Stonewall's CEO Lloyd Birrell, the company has only been listed on the ASX for less than six months.
Shandong Qixing Iron Tower Company Limited is part of the Qixing Group Company Limited, group revenue exceeded RMB15 billion ($2.3 billion) in 2012.
Stonewall's South African assets include several surface and near-surface gold mineralisations, provide cost advantages relative to other gold producers in the region.
With significant infrastructure already in place, Stonewall is positioned to make the transition to producer through highly efficient utilization of capital and within short lead times.
Stonewall’s three key projects are the TGME Project, located around the towns of Pilgrims Rest and Sabie in the Mpumalanga Province of South Africa (one of South Africa’s oldest gold mining districts), the Bosveld Project, located in South Africa’s KwaZulu-Natal Province, and the Lucky Draw Project, located in Australia, near the township of Burraga in New South Wales.
Stonewall is currently processing gold from tailings dumps located within its TGME and Bosveld Projects, as well as the underground mining complex of Theta/Frankfurt from which it is earning revenue.
Stonewall aims to introduce two additional near term production targets during 2013.
Which proves that interest in acquiring gold assets from would be buyers is intact and interest from China in ASX-listed gold companies as they move from explorer to producer is not long gone.
Proactive Investors Australia is the market leader in producing news, articles and research reports on ASX “Small and Mid-cap” stocks with distribution in Australia, UK, North America and Hong Kong / China.