Metro Mining increases Gulf Alumina ownership

<p>Metro Mining Ltd has confirmed it has entered binding agreements to increase its ownership in Gulf Alumina Limited to approximately 39% of the total issued capital of Gulf. <br /><br />The Announcement follows Metro&rsquo;s shares being placed in a trading halt on Monday. (19 Sept.) <br /><br />Under the agreements Metro will acquire the shareholdings of four long-term Gulf shareholders. Total cash consideration for the acquisition is approximately $8.5 million to be funded by an unsecured loan arranged on commercial terms. <br /><br />Following the acquisition, Metro&rsquo;s cash position will be approximately $8.9 million. <br />Metro CEO Simon Finnis says the key focus continues to be the near term development of Bauxite Hills while remaining open to bringing about the logical combination of Metro and Gulf&rsquo;s projects to unlock significant synergies and commercial benefits for the shareholders of both companies. <br /><br />{googleAdsense}<br /><br />Earlier this month Mr Finnis told shareholders an independent expert appointed by Gulf during the initial takeover bid had identified over $200 million in Metro and Gulf merger synergies. These included:<br />&nbsp;<br />&bull; Reduction of joint pre-production capital expenditure from A$92 million to (circa)A$75 million. <br />&bull; Reduced average operating costs from A$19.0 per tonne to A$17.2 per tonne (excluding royalties) <br />&bull; Removal of duplicated corporate costs. <br />&bull; An enhanced ability to secure funding to develop both projects <br />&bull; A greater depth in the team led by experienced Metro executives. <br /><br />In an unrelated transaction, UK based Greenstone Resources yesterday finalised its A$8.9 million investment for a 19.98% interest in Metro. In addition to providing strategic support, Greenstone has conditionally committed to provide a further US$20 million for the development of Bauxite Hills. <br /><br /></p>