PRAGUE/LONDON, November 3, 2023 – This week, the fifth Czech company entered the main market of the London Stock Exchange (LSE), namely Mineral Ventures Invest (MVI), a holding company of the domestic joint-stock company Zlato. MVI has become the majority owner (51%) of the Irish mining and quarrying company IMC Exploration Group (IMC), which is one of more than 2,000 shares listed on the prestigious London Stock Exchange.
After three years, the transaction, which is defined as a “Reverse Takeover” (RTO) under British and Irish law, was completed. “The Irish IMC bought the Karaberd gold mine in Armenia from the Czech MVI and paid for it with its own shares, which it newly issued on Wednesday,” explained David Marášek, CEO of Mineral Ventures Invest, which belongs to the group of one of the largest domestic sellers of investment gold. At the same time, it is the first successful takeover that a Czech company has achieved on the main market of the London Stock Exchange.
Ireland’s IMC has been involved in the exploration and mining of precious metals and minerals since 2011. It has licenses for two deposits of gold (and other precious metals) in south-eastern Ireland (Avoca mine and North Wexford Gold River) and based on the above transaction it acquired the Karaberd gold mine in the north of Armenia, where gold mining has been going on for the fourth year.
This spring, the evaluation report of the international valuation institution Alvarez & Marsal – London valued the company IMC at 42 million pounds (currently approx. 1.1 billion CZK), according to other market estimates and experts, the market capitalization of the Irish company should range up to 52 million .pounds.
Eamon O’Brien, IMC’s executive chairman, said that “the acquisition of the Karaberd gold mine will be transformational for IMC, particularly as it adds a Czech and Armenian team with rich mining experience”. According to O’Brien, the acquisition will also result in IMC having a first-of-its-kind environmentally clean metal ore processing plant. “This will help support IMC’s growth as an environmentally friendly mining company,” he stressed.
At the end of September this year, the British regulator (FCA, UK Financial Conduct Authority) approved the takeover transaction, and then at the beginning of October, the management of the Irish IMC informed about the approval and publication of the prospectus for the takeover of the Karaberd gold mine in Armenia. “Last week, the general meeting of the IMC company took place to formally confirm the transaction,” added Marášek.
Until now, the Karaberd mine was owned by the Armenian company Assat, which is 100% owned by the domestic company MVI in the holding Zlato as. This company, which has a license for another gold deposit in Armenia, is majority owned by the joint-stock company Zlato, which is one of the leading sellers of investment gold in the Czech Republic and has the ambition to become a leader on the domestic market.
Zlato is the only domestic seller of investment gold that has its own mine. According to the geological expertise of the multinational company CSA Global, the Karaberd mine has reserves of 6.92 tons of gold, while a ton of ore from this mine contains an average of 5.4 grams of gold. “This makes Karaberd a very attractive deposit, if we consider that most of the world’s deposits report roughly 1.5 grams of gold per ton,” explained David Marášek.
According to David Marášek, entering the London Stock Exchange culminated several years of efforts by the forty-member team that started gold mining in Armenia in 2018. “The Prague branch of the law firm Kinstellar helped us significantly with the transaction, which, among other things, participated in the listing of domestic Avast on the London Stock Exchange a few years ago,” he added, adding that the first talks with IMC took place in mid-2019.
“We are very happy to have been able to assist MVI in its strategic steps on the international scene. Entry to the London Stock Exchange is a key milestone that reflects the company’s growth potential and ambitions. This transaction was very complex, involved the coordination of several jurisdictions and required multidisciplinary legal expertise, and is, to our knowledge, the first successful RTO achieved by a Czech company on the LSE main market. We are proud to have been part of this success. It is further proof of the strength and capabilities of Czech companies on the global market,” said Lukáš Ševčík, Managing Partner of the Prague branch of the law firm Kinstellar.
According to Marášek, the market immediately reacted to the issuance of 358,806,572 new ordinary shares on the London Stock Exchange on Wednesday, and the price of one share increased by more than 20 percent during the day compared to Tuesday. Shares of the Irish company IMC Exploration Group on the LSE can also be purchased in the Czech Republic through Interactive Brokers (Lynx), Patria Direct or Wood & Company.
Commercial article
