Contel

Contel: to resume trading at 9am, after halt since 2pm Wed. To buy Solar Silicon Resources (SSRG) in US$1.2b RTO, in the largest such deal on SGX over the past 5 yrs. Contel will issue 3.1b consolidated new shares at $0.505/sh to AMRG. Contel plans to consolidate 10 shares into 1. AMRG will own 79% stake when the proposed acq and a $26m compliance placement are completed…

Contel last closed at 3cts, so deal effectively at 68% premium to last traded. Consideration for the 3.1b shares are 95m of SSRG shares. SSRG has net tangible assets of US$226m as at Sept 30. Note that Contel is very likely to enter into a Scheme of Arrangement to discuss terms with its creditors, was making losses and negative net assets as of 30 Sept….

SSRG is a wholly-owned unit of AuzMinerals Resource Group (AMRG), a mine dev and mineral exploration co in Queensland, Australia. SSRG supplies primary high-purity silica to solar manufacturers and owns a silica mine in Queensland. The group has recorded no revenue since incorp in Aug 2009 and a net loss of US$0.8m for 1H Sept 30.