Report

Pan African Resources - Tennant Creek acquisition

On 5 November, Pan African Resources (PAF) announced that it is to acquire privately owned Tennant Consolidated Mining Group (TCMG) in Australia’s Northern Territory for a total consideration of US$54.2m in an all-share deal that involves it issuing an additional 125.4m shares (or 6.5% of its existing share capital). The acquisition price equates to an undemanding US$42.15 per resource ounce of gold or US$139.21 per reserve ounce. While we expect the acquisition to have little effect on PAF’s earnings in FY25 (apart from the increase in share capital), we estimate that it will increase FY26 earnings by US$24.6m (or 19.1%) and FY27 earnings by US$42.6m (or 29.6%) and, on this basis, will undoubtedly be accretive.
Underlying
Pan African Resources PLC

Pan African Resources is a mid-tier African-focused precious metals producer. Co.'s business activities were conducted through the following business segments: Barberton Mines (including Barberton Tailings Retreatment Plant), located in Barberton, South Africa; Evander Mines (including Evander Mines' Tailings Retreatment Plant), located in Evander, South Africa;Corporate; and Pan African Resources Funding Company Proprietary Limited.

Provider
Edison Investment Research
Edison Investment Research

Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisors and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting.

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Analysts
Alison Turner

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