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MRC Allied eyes P750 million via preferred shares offer

MRC Allied Inc. is planning to raise P750 million through a preferred share offering next year to fund pre-operating expenses for gold and copper projects in Kiblawan, Davao Del Sur. In a press briefing, MRC corporate information officer Miguel A. Bitanga said the preferred share offering will likely take place in the first quarter next year to allow them to jumpstart the development of the 7,995-hectare mine site in Kiblawan and Columbio, Sultan Kudarat. The property is adjacent to the $5.2-billion Tampakan copper-gold project which is believed to contain one of the biggest untapped copper resources in Southeast Asia. MRC’s entry into the mining business was formalized following the signing of a mining operations agreement wih Alberto Mining Corp., through its president Geronimo Palermo. Bitanga said the deal was six months in the making and was an initiative of his father, MRC president Benjamin Bitanga. Under the agreement, MRC will issue P300 million worth of shares and cash to Alberto Mining, which is reportedly the same group behind Sagittarius Mines, which owns the 11,000-hectare Tampakan copper-gold project. Bitanga said the company is excited about the Kiblawan project, pointing out that earlier geological studies showed similar findings as those in the Tampakan project during its initial test phase. He said the company will conduct further studies and drilling activities once it secures the necessary permits. Bitanga said the group is open to forging partnerships with other mining companies for this project, which will serve as MRC’s flagship project and the backbone of its future business ventures. The company is setting up a P1-billion subsidiary to be called MRC Mining Inc. to handle its mining endeavors. MRC is now 87 percent owned by Menlo Capital, which is 51 percent owned by the eldest son of tobacco and airlines tycoon Lucio Tan. MRC’s new business direction is to acquire operating companies or entities that will give the company immediate profitability. The company expects to be in a position of positive operating cash flow by the first quarter of 2011. For the whole of next year, MRC is eyeing net earnings of P150 million and revenues of at least P4 billion. Among MRC’s notable assets include the 237-hectare New Cebu Township One (NCTO) and 2,312-hectare Amihan Woodlands Township (AWT) in Leyte, both master-planned communities with integrated residential, commercial, industrial, and tourism areas. Most recently, MRC struck a deal with Benisons Shopping Center Inc to acquire the newest mall in Divisoria as its latest project.

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