Rockfire Resources acquires Emirates Gold and Emperesse Bullion
Rockfire Resources plc, a key player in gold, base metal, and critical mineral exploration, has entered into a conditional share purchase agreement with Paloma Precious DMCC for the acquisition of 100% of Emirates Gold DMCC and 99% of Emperesse Bullion LLC. The total consideration for this landmark deal is set at $20 million, subject to shareholder and regulatory approvals.
Reverse Takeover Leads to Trading Suspension on AIM
The acquisition qualifies as a reverse takeover under the AIM Rules for Companies, leading to a temporary suspension in the trading of Rockfire’s ordinary shares starting at 7:30 a.m., 15 September 2023. The suspension will last until the publication of an AIM admission document or an announcement indicating the deal’s termination.
Overview of Acquired Companies: Emirates and Emperesse
Paloma, Rockfire’s largest shareholder, owns Emirates Gold and Emperesse Bullion. Emirates Gold specializes in operating a gold and silver refinery and trading non-manufactured precious metals in Dubai’s DMCC free-trade zone. In contrast, Emperesse Bullion is engaged in precious metal trading and operates a shop in Dubai’s Gold Souk market.
Financial Performance of Targets
In 2022, Emirates Gold reported an EBITDA of approximately £2.4 million on revenue of approximately £3.9 billion. Emperesse Bullion had a profit of around £0.065 million on a revenue of approximately £0.616 million. These acquisitions are expected to significantly boost Rockfire’s growth strategy.
David Price, Chief Executive of Rockfire, said, “The Board of Rockfire has identified an exceptional opportunity to acquire two cash-generating businesses, which are entirely in line with the full value-add integration of precious and base metal exploration, development, production, refining and trading.”
Key Transaction Terms
Upon signing the agreement, Rockfire will initially acquire 10% of Emirates and Emperesse for $2 million USD in cash. The remaining shares will be transferred to Rockfire upon the deal’s completion for a final consideration of $18 million USD in cash.
Conditional Terms & Regulatory Barriers
The deal is contingent upon Emirates being restored to the UAE Delivery List of approved refineries, among other conditions. The removal of Emirates from this list in July 2023 also led to the revocation of its affiliate membership in the London Bullion Market Association.
The acquisition aims to be a transformative move for Rockfire, positioning the company for rapid growth in the precious metal sector, backed by strong cash flow.