Marcventures borrows P100 million for nickel mine

MANILA, Philippines - Marcventures Holdings Inc. (formerly Ajo.net Holdings) has completed a P100 million convertible loan with 13 lenders, according to the company’s disclosure filed with securities regulators yesterday.

Marcventures said it will use the proceeds of the loan to further develop its nickel mining property and for operating expenses.

The loan matures in one year with interest fixed at 12 percent, computed on the outstanding balance of the loan from date of drawdown.

 The lenders shall have the option to convert all or a portion of the loan into fully paid shares of stock of Marcventures at any time prior to the maturity of the loan at P2.20 per share. Upon conversion, the lenders shall be entitled to a warrant to subscribe to one Marcventure share for every four converted shares at the same price. The warrants are subject to a two-year exercise period.

Marventures recently obtained the Securities and Exchange Commission’s approval to change the par value of its shares from one centavo to P1 apiece. As a result, its authorized capitalization now comprises two billion common shares.

Its parent firm, Marcventures Mining and Development Corp. (MMDC), has obtained incentives from the Board of Investments (BOI) for a P474-million investment in a mining project in Surigao del Sur.

MMDC, a company headed by former Lepanto Consolidated Mining president Ramon Recto, has a mineral production sharing agreement to mine 4,799 hectares of land in Cantilan, Surigao del Sur for nickel and gold. The company has taken over Ajo.net in April in a share swap deal valued at P1.3 billion.

Under the deal, MMDC subscribed to 45 billion shares of Ajo.net at the new par value of one centavo.

Marcventrures is aiming to produce 600,000 metric tons of nickel ore in the first year of operations. The figure is expected to increase to 800,000 MT and 1.2 million MT in the second and third years, respectively.