Flinders Mines Receives Shareholder Application Regarding De-Listing Proposal


On 10 January 2019, Flinders Mines Limited (ASX: FMS) has announced that the panel has received an application from Mr. Brendon Dunstan (the Applicant) in relation to the affairs of Flinders Mines limited.

Flinders Mines Limited is under the mining sector which focuses on iron ore exploration. Flinders Mines Limited is an Australian company which was incorporated in 2000 and got listed on ASX in February 2002.

The application filed by Mr. Brendon Dunstan (the Applicant) is related to the proposed transactions which were announced by Flinders on December 13, 2018. Flinders wants to delist from the Australian Stock Exchange, and for that, the company has scheduled a special meeting for Tuesday, January 22, 2019, so that they can get approval from the shareholders.

FMS proposes an on-market buy-back process and an unmarketable parcels sale process so that they can support the delisting process. The buy-back is supported by a loan facility, and this loan facility is provided by a TIO (NZ) Limited, a subsidiary of Flinders’ largest shareholder. A non-renounceable pro-rata rights will be issued for the repayment of the loan, and it will be undertaken following the buy-back.

TIO (NZ) Limited owns approximately 56% stake in Flinders and intends to vote in favor of the delisting.

Currently no sitting Panel has been appointed at this stage, and still, no decision is taken about whether to conduct the proceedings or not with no comment over the merits of the application.

The Applicant submitted other concerns as well:

  • The shareholders of the company did not receive enough time or enough information for evaluating the merits of the proposed transactions and
  • Previously, The Todd Group Limited, indirect parent of TIO (NZ) has lodged substantial holding notices, and all the notices were defective.
  • The proposed transactions would involve TIO to secure further voting rights, contrary to policy objectives under Section 602.

Financial Performance: As at 30 September 2018, the company had $5.12 million in cash for the quarter with no debt. On August 2018, the company announced the completion of its Entitlement Offer raising approx. $8.275 million (before costs) through receipt of valid applications for a total of 118,218,635 shares.  The Company’s net loss for the year stood at $1,810,000 in 2018. The diluted loss per share for the year stood at 0.058 cents per share. On Balance Sheet front, Net Assets for the year stood at $56,882,000 in FY18, representing a downside of 3% over the $58,692,000 recorded in the corresponding period in 2017. As at 30 June 2018, the company had cash and cash equivalent of $3,301,000.

Stock performance: In the last six months, the share price of the company has shown a negative return of 65 percent as on 10 January 2019. The stock was 59.42 percent down over the past One month. Flinders Mines Limited shares closed 3.6% down today at A$0.027 with a market capitalization of A$97.58 million as on 11 January 2019.


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