Manila Mining hikes capital to P3 billion

MANILA, Philippines - Manila Mining Corp. is increasing its authorized capital stock from P1.8 billion to P3 billion to raise funds for a feasibility study on its mothballed Placer copper-gold mine project in Surigao del Norte.

The resolution to increase its authorized capital stock to P3 billion was approved yesterday by 69.4% of MMC’s shareholders with one minority shareholder – Deutsche Bank – expressing its lone opposition to the increase.

Deutsche Bank, holding 368 million shares equivalent to 0.2 percent of MMC’s shares, formally conveyed its opposition during the annual stockholders’ meeting of the Lepanto Consolidated Mining Corp. subsidiary yesterday at the Lepanto Building.

Ethelwoldo E. Fernandez, corporate secretary of MMC, said Deutsche – which is holding the shares for an unknown principal – registered its opposition for purposes of “appraisal rights.”

Appraisal right is the “right of shareholders to demand the fair payment of securities undergoing a merger by a third party valuator.”

It is supposed to be a protection policy for shareholders, preventing corporations involved in the merger from paying less than the company is worth to the shareholders.

According to Felipe U. Yap, chairman and chief executive officer of MMC, the firm is financing a new bankable feasibility study in preparation for the rehabilitation of the currently mothballed operation of its Placer copper-gold mine project in Surigao.

Yap projects that following the completion of the feasibility study, the Placer mine can undergo rehabilitation and resume operation by mid-2010.

Placer mine operations have been suspended for the past eight years.

Yap also expressed optimism that once the bankable feasibility study is completed, interested parties would come in to invest in the once profitable mine.

However, at least one major British mining firm has passed up on the project.

In 2007, London-based Anglo-American had entered into a joint venture agreement with MMC for the exploration of the Bayugo copper-gold project in Anislagan, Placer, Surigao del Norte.

Anglo-American spent  $10 million for exploration works on the Placer mine, but eventually pulled out of the joint venture following unsatisfactory drilling results.

Anglo-American had a similar arrangement with Philex Mining Corp. from which it also similarly pulled out.

The British mining firm is now prospecting in the Cordilleras. – Marianne Go