The Panel has made a declaration of unacceptable circumstances (Annexure A) and accepted undertakings in lieu of making final orders1 (Annexure B and Annexure C) in relation to an application dated 17 October 2022 by Simto Resources Pty Ltd in relation to the affairs of Mineral Commodities Limited (see TP22/55)

Background

On 3 October 2022, MRC announced an equity raising comprising a placement to its largest shareholder, Au Mining Limited (Au Mining) to raise approximately $1.75 million and a 1 for 3 non-renounceable rights issue to raise up to approximately $14 million (Rights Issue). The Rights Issue was to be partially underwritten by:

Au Mining, for up to $6.6 million * Mr Jacob Deysel (MRC's managing director), for up to $100,000 and * Mr Guy Walker (AU Mining's company secretary and a non-executive director of MRC), for up to $100,000.

Mr Walker was involved in the negotiation of the placement and the underwriting of the Rights Issue by Au Mining, on Au Mining's behalf. The offer document in respect of the Rights Issue disclosed that Au Mining's voting power could potentially increase to up to 45.23% as a result of the Rights Issue and underwriting of the Rights Issue2. No information was disclosed in the offer document concerning the directors, ultimate beneficial owners or business of AuMining, and largely generic information was disclosed in relation to Au Mining's intentions for MRC should it obtain effective control of MRC. The offer document disclosed that the Rights Issue would include a shortfall facility, with shortfall allocated at the discretion of MRC in consultation with the underwriters, subject to the terms of the underwriting agreements, and would otherwise be allocated in an equitable and proportionate manner by reference to existing shareholders. The disclosure in the offer document of the total number of shortfall shares was uncertain. No information was disclosed in the offer document around the process undertaken to manage any conflicts of interest potentially arising in connection with the Rights Issue, including the conflict of Mr Walker's duties to MRC and Au Mining

Contact:

Allan Bulman

Chief Executive

Takeovers Panel Level 16

530 Collins Street

Melbourne VIC 3000

T: +61 3 9655 3500

E: takeovers@takeovers.gov.au

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