Austindo to take control of HMH Gold

Austindo to take control of HMH Gold

SYDNEY (Reuter): HMH Gold Mining Corp Ltd said yesterday Indonesia's PT Austindo Mining Corp (AMC) would move to a controlling interest in the gold producer and explorer after first taking a strategic stake.

HMH, which is also listed on the Vancouver Stock Exchange and whose major shareholder is Hongkong Macau (Holdings) Ltd, said the first step in AMC gaining 41.35 percent of its shares would be the immediate acquisition of 13.75 million ordinary shares at A$0.20 a share.

A year later AMC, a company wholly owned by the Tahija family, would take another 11.25 million shares at the same price per share.

AMC would also be awarded an option to acquire a further 37.5 million shares at A$0.25 each at any time up to the third anniversary of the first allotment.

The HMH Gold board would also be reconstituted and the proposed deal would be put to an extraordinary general meeting within 60 days, HMH said.

"HMH Gold welcomes the participation of AMC in the future development of its gold activities in Indonesia and looks forward to the positive contribution that AMC's experience and background will bring at both board and management levels," the company said.

HMH, which has production and exploration acreage in West Kalimantan, said in April it and other explorers in Indonesia had been hurt by the controversy which surrounded the faked Busang gold "discovery" of Bre-X Minerals Ltd.