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Fox Marble Holdings Acquires Gulf Marble Investments
Friday 12 October 2018

12 October 2018 - UK-based Fox Marble Holdings plc (LSE: FOX), which is focused on marble quarrying and finishing in Kosovo and the Balkans region, has acquired Gulf Marble Investments Ltd. (Dubai), its joint venture partner based in the Prilep Alpha Quarry in Macedonia, including all the rights attached to that company, Fox Marble said.
 
Under the terms of the original agreement to acquire the Prilep Alpha quarry in Macedonia in 2013, Gulf Marble Investments Ltd. provided the funds to acquire the license to the site and capital investment amounting to EUR 1.7m (USD 1.97m), and then entered into an operating agreement with Fox Marble to operate the quarry.

In compensation Gulf Marble Investments Ltd. was provided with a royalty amounting to 40% of the gross revenues received from the sale of its block marble from the quarry.

The acquisition of the quarry rights in Prilep Alpha was originally announced on the 4 July 2013.
 
Through the acquisition of 100% of the share capital of Gulf Marble Investments Ltd., Fox Marble will effectively re-acquire all the 40% gross revenue royalty, as well as all the assets and capital equipment held by the entity.
 
As consideration for the acquisition Fox Marble has issued an unsecured convertible loan note in the amount of EUR 1.785m.

Under the terms of the loan note, the holder may elect to convert at a conversion price of 130% of the three month volume weighted average share price.

The loan note is repayable from the 1 October 2020. The loan note carries an interest rate of Libor plus 1.5% payable annually in arrears.
 
Following the issue of the convertible loan note detailed above the company has a total of GBP 2.85m convertible Loan notes outstanding.
 
Fox Marble is a marble production, processing and distribution company in Kosovo and the Balkans region.

Its marble products, which includes Illirico Bianco, Illirico Selene, Grigio Argento and are gaining traction globally both to international wholesale companies as well as being supplied directly into luxury residential properties.

In the UK these include among others St George's Homes and Capital and Counties Plc's Lillie Square development. In Sydney, Australia Rosso Cait, Alexandrian White and Breccia Paradisea marble have been used in what is expected to be Australia's most expensive residential property.

These sales serve to demonstrate the desirability of Fox's premium marble products as the stone of choice in some of the most prestigious and expensive residential developments around the world.

Fox Marble holds 40 year mining licences for six separate marble quarries with a maiden JORC resource indicating an in-situ valuation of approximately EUR 16.5bn.

Fox has taken three of the six sites into production (the Drini and Maleshevë quarries, both in Kosovo and from the Prilep Quarry in Macedonia) and continues to increase production. Notably, Fox has access to over 300 m cubic metres (over 1bn tons) of premium quality marble.

Marble demand continues to grow with stable pricing, predominantly driven by the construction and real-estate industries, on which Fox is looking to capitalise.
Details
Date Published: 12/10/2018
Target: Gulf Marble Investments
Country: Macedonia
Deal Size: 1.97m (USD)
Sector: Metals/Mining
Type: Corporate acquisition
Financing: Cash
Status: Closed
Vendor:
Buyer: Fox Marble Holdings
Comment:
Acquisition of JV partner

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