At launch it has a market cap. of £3.28m. Here are some key facts & statements from the Admission Document:
Q Resources is a new company incorporated under the laws of Jersey. The Company has been established for the purpose of identifying and acquiring, or making investments in, Resources assets, with an initial focus on Africa and/or South America.
On Admission, Q Resources will have no trading business, giving the Directors a platform to carry out a detailed examination of potential acquisition targets. The Company, in determining potential acquisitions, will consider all sectors of the Resources industry, but will primarily focus on metals and minerals assets.
The Directors intend to complete the first acquisition within 12 months of Admission, which they intend will constitute a Reverse Takeover (and therefore will require Shareholder approval) in order to provide the Company with an operating business. Following the initial acquisition, the Directors will review the strategic development of the Company.
In conjunction with the Admission, the Company has conditionally raised £2.955 million, net of expenses through a placing of 54,583,333 Placing Shares and 13,645,833 2010 Warrants with institutional and other investors, details of which are set out below.
The Directors believe that market conditions over recent years have proven difficult for certain businesses operating in the Resources sector and that an opportunity now exists for acquiring and/or investing in such businesses and/or assets so that their growth potential can be realised for the benefit of Shareholders.
The Directors believe that recent instability in the general economic markets and the Resources industry has created a number of investment and acquisition opportunities and that a number of Resources businesses may be short of capital but yet retain potentially highly valuable assets and operations. By taking advantage of such opportunities and relatively low earnings multiples, the Directors believe they can create value by sourcing further funds and experienced personnel and thereby position the Company to take advantage of demand in the Resources sector. Through these targeted acquisitions, the Directors aim to shorten the otherwise long process they believe the Company would experience in obtaining a new Resources licence and taking an asset through to production, in readiness for any economic upturn and anticipated higher commodity price levels.
The Directors believe that Africa in particular represents an excellent opportunity with momentum now returning to the mining sector. African exports have been hit hard as the global crisis has reduced consumption in major economies. However, the Directors believe that a resurgence in demand is being driven by growth in China, India and south east Asia, and to a lesser extent by fiscal stimulus programmes in western economies followed by a slower increase in more general global economic activity.
...The Company has already appointed Rui de Sousa and Gazprombank-Invest (MENA) as consultants to the Company, conditional on Admission, further details of which are set out below in “The Investment Process” and the Board will also look to appoint other suitably experienced consultants, as appropriate...
Rui de Sousa has entered into a consultancy agreement with the Company to, basis, potential acquisitions and provide strategic advice thereon...
Rui de Sousa is also a director and shareholder of Quantic, a private investment group operating in certain areas of the oil and gas sector and merchant banking across Africa and the Middle East. Quantic owns 70 per cent. of Gazprombank-Invest (MENA), further details of which are set out below, and of which Rui de Sousa is also a director. Quantic also provides advisory and consultancy services to Cove Energy PLC, an AIM quoted upstream oil and gas company...
...Upon Admission Quantic Mining will be granted the Quantic Mining Warrants and Quantic, will subscribe on behalf of Quantic Mining for 16,425,000 Placing Shares and 4,106,250 2010 Warrants, further details of which are set out below in paragraphs 8 and 9.
So, Quantic will own around 1/3 of Q Resources' shares upon admission.
Whilst I see little point in investing at this stage, as QRES is simply a cash shell, I am adding it to my watchlist. It will be interesting to see what the acquisiton targets turn out to be. As a shrewd investor, Mr de Sousa's investment thesis merits further study.
The author may hold shares in this company, all opinions are his own and you should check any statements that appear factual and not rely on them before making an investment decision. The author is NOT a qualified analyst nor authorised to give investment advice. Whilst the author is a director of ShareSoc, all views expressed are entirely his own and not necessarily those of ShareSoc.