Nathan Tinkler forks out $10m for 20pc stake in Jameson Resources

Former coal baron Nathan Tinkler forks out $10m for a 20 per cent take in Jameson Resources after losing out on a bid for Australian Pacific Coal.

Shares in would-be coking coal producer Jameson Resources jumped on Monday after former coal baron Nathan Tinkler put his hat in the ring at the company, tipping in $10m at a 70 per cent premium to its recent trading price.

Jameson's shares closed up 53.9 per cent, or 3.5c, at 10c on Monday, after the company went public with a placement to companies associated with Mr Tinkler.

His move on Jameson’s register comes after he was muscled out of a bid to take control of Australian Pacific Coal in September.

The deal will reunite Mr Tinkler with former Macarthur Coal executives Nicole Hollows and Michael Gray. Mr Tinkler sold his Middlemount coal deposit to Macarthur in 2007 for $275m, paid mostly in shares, after acquiring an option on the coal seam for a $1m deposit the year before.

Mr Tinkler went on to sell his Macarthur shares to Indian steelmaker Arcelor Mittel for $442m in an exquisitely timed deal in 2008, laying the foundation for his rise to prominence in the sector. Macarthur was later bought out by US coal producer Peabody Energy.

Ms Hollows is now the chair of Jameson, and Mr Gray its managing director. Ms Hollows said in a statement she looked forward to working with Mr Tinkler again.

“Mr Tinkler’s ability to identify quality undervalued coal projects and progress development plans to create significant value for shareholders has been clearly demonstrated with the successful development and ongoing operation of the Middlemount and Maules Creek projects,” she said.

Jameson chair Nicole Hollows is looking forward to working with Nathan Tinkler again.

Under the deal announced to investors on Monday, Mr Tinkler’s Oceltip Coal entities will kick in $10m at 11.55c a share into Jameson, paying a 70 per cent premium to its average trading price over the last 15 days.

The deal will essentially see Mr Tinkler and his associates kick in just under half of Jameson’s current $22.6m market capitalisation and emerge with a 20 per cent stake in the company.

The initial tranche of $5m will be chipped in immediately, with the rest to follow in February.

Mr Tinkler is a director of the two companies that will participate in the raising, Oceltip Coal 1 and Oceltip Coal 2. Records accessed from the corporate regulator show they are both owned by Mr Tinkler’s father, Leslie Tinkler.

Jameson’s major assets are coking coal exploration projects in British Columbia in Canada.

In August, Mr Tinkler was part of a consortium that made a $1 a share bid for Australian Pacific Coal, which owns the Dartbrook coal mine in the Hunter Valley.

That bid was stymied when the company’s board opted for a $100m capital raising instead.

Jameson finished September with only $1.2m at bank, with the company spending $462,000 in the period on the exploration and development of its Canadian coal projects, which it owns with fellow ASX-listed junior Bathurst Resources.

Jameson says it expects Canadian environmental authorities to begin a formal technical review of its Crown Mountain project early next year, with permitting likely to be completed in by 2025 and construction to start in 2026.

Canadian coking coal has been one of the major beneficiaries of China’s ban on Australian coal, but its ability to capitalise has been slowed by the lengthy permitting process for new projects.

A 2020 bankable feasibility study put capital costs for Crown Mountain at $US351m, for a project producing an average 1.7 million tonnes of coking coal a year over a 15 year mine life.

In a statement on Monday, Jameson said it will use the cash raising from Mr Tinkler’s companies to pay its share of environmental assessment costs, open talks with potential buyers and financiers and “assessment of potential strategic investment or acquisition opportunities by Jameson”.

Originally published as Nathan Tinkler forks out $10m for 20pc stake in Jameson Resources