Kazakh gold miner Solidcore Resources announced plans to return up to $1.2 billion to shareholders through a buyback of its own shares. This was reported by Qazaqyia.kz citing Kursiv Media.
According to a company press release published on September 8, Solidcore intends to buy back up to 102.9 million shares, or about 23.2% of its current share capital, under the tender. The price per share will be $11.66, approximately 10% above the 30-day volume-weighted average price as of September 7.
The tender offer will open on September 9 at 11:00 Astana time and close on October 12 at 17:00. The transaction still requires shareholder approval. A general meeting will be held on September 30 in Astana.
If shareholders offer no more than 102.9 million shares for repurchase, the company will acquire the entire volume. If more shares are tendered, they will be bought back on a pro-rata basis.
Solidcore emphasized that this tender is a one-time return of capital and does not imply the introduction of a permanent shareholder payout policy.
"We believe the tender offer is a compelling way to use available capital. It provides liquidity to shareholders who wish to exit their investment, while remaining owners retain full exposure to the company's future growth," said Evgeny Konovalenko, senior independent non-executive director of Solidcore.
In a comment to Reuters, Solidcore CEO Vitaly Nesis said that after this large buyback, the company does not plan additional payouts to shareholders until it reaches its strategic goal. This refers to plans to increase potential production to 1 million ounces of gold equivalent per year by 2029.
Thus, $1.2 billion is the planned one-time return of capital, after which Solidcore intends to direct funds toward implementing its growth strategy.
Solidcore's largest shareholder, Maaden International Investment SPC, which owns 31.7% of the company, has committed not to participate in the buyback. CEO Vitaly Nesis has made the same commitment.
The company believes this demonstrates the long-term interest of key shareholders and management in the development of the business.
As of September 1, Solidcore's cash stood at $1.4 billion, with a net cash position of $747 million. Additionally, the company raised $700 million in external financing for the Ertis POX project.
The share buyback is expected to reduce the number of shares outstanding and, all else being equal, increase the stake of shareholders who choose not to participate in the tender.
Earlier, Kursiv reported that the largest gold miner would begin developing a tin deposit in Kazakhstan.