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Concert Party at OreVest

Article Date:  Nov 26 2002

Mining investment minnow OreVest, which lost £313,000 in the 13 months to June, will be nearly 94 per cent owned by the vendors of Energy and Mine Investment (EMI), which the company is buying with 600 million dew shares for the sake of its Botova River manganese mine in Bulgaria. Robert Tyerman reports.

The EMI vendors will form a 'concert party' under City takeover rules, but the Takeover Panel has agreed to waive the normal requirement which would oblige the EMI vendors to bid for the residue of Ofex-traded OreVest. The deal values EMI at £12 million at a notional 2p per OreVest share and, if that valuation were taken as realistic, by implication, adds that much to OreVest's worth, in theory at least – even though OreVest's shares remain suspended at 0.75p, where its market value stands at £210,000.

At the end of June, OreVest, headed by the entrepreneurial Jo Malins, had net liabilities of £33,000 and a deficit on shareholders' funds of the same amount. In May, the company announced it proposed to issue shares to Canadian group MIT Ventures in exchange for the right to earn 70 per cent of MIT's diamond exploration properties in Ontario and in June said it was still carrying out due diligence on the deal.

Backed by the indefatigable Bruce Rowan, OreVest was floated on Ofex at 1p in mid-2001 under Andrew Counsell, former boss of the Adelaide Stock Exchange. Advised by the colourful Robert Nelson, the company entered into a deal with South African diamond group Mazall, but that came to nought.

Since Malins, former head of engineering group Telfos, was installed, two investment groups dreamt up by financier Willie West, Resources Investment Trust and New Opportunities Investment Trust, have backed OreVest, RIT with £50,000 in cash and New Opportunities with a bundle of its own (weak) shares. In September, OreVest issued 1.3 million shares at 2p to settle debts of £27,180 to two outstanding creditors.

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