Qatar, as in money

The agreement between Ellaktor group and Qatar Holding, which was signed suddenly last Saturday and provides for 360mil-dollar additional investments by the Arabs in the great project of Greek gold, conceals the acquisition of an additional 20% of shares in European Goldfield, which owns the mining rights in the Chalkidiki mines.

Reportedly the agreement with Qatar Holding, which for starters acquired 10% of the company shares, was made in London in the past few days with the participation of the Lazzard investment bank as well.

The approval of the environmental conditions of the project by new environment minister Giorgos Papakonstantinou last July paved the way for the partnership with Qatar, which brought on the direct need for financing, as banks had withdrawn from the project.

Of the total amount of 750mil dollars to be disbursed, 600 will come from the loan that European Goldfield will take from Qatar Holding (a seven-year loan at 7% over the six-month work that will begin to be paid in 2015) and another 150mil dollars from existing shareholders, who are mainly investment funds.

In order for the projects to begin in the mines of Chalkidiki, it will take some technical studies and Forest Service approvals, which are expected to start by the end of the month. The overall investment is expected to exceed 1,2 billion dollars.

A statement made by the company mentions that Qatar Holding has an option to purchase an additional 9.373.390 of the shares for 13 Canadian dollars per share.

The agreement closed at the price of 10 Canadian dollars per share, with the sale of 7,2% of the Ellaktor shares (it owned 19,4%) and 2,9% of Dimitri Koutras (from 5,9%) to European Goldfield. Following the transaction, the construction group and Koutras have joint control of over 15,2% of the company’s shares. The total cost of the 10% sale is about 180mil Canadian dollars.

This agreement sets the foundation for a broader cooperation between the two sides to exploit the mineral wealth of the country, but also in other projects of mutual interest. One should also not rule out some form of cooperation even in terms of the use of Hellinikon, if Qatar finally takes part in the concession process of the area.