Tuesday, June 22, 2021
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Mining tycoon Mick Davis joins the dash for SPAC cash to build up green energy mining giant

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Sir Mick Davis, the former boss of Xstrata and one of the biggest names in mining, today raised $300 million for his new mining venture with a special purpose acquisition company in the US.

The former Conservative party treasurer has partnered his Vision Blue Resources business with the New York-listed SPAC ESM Acquisition Company to hunt for and invest in new mining ventures that will produce minerals needed for electric vehicles and other green energy technologies.

SPACs have raised billions of dollars in the US and Amsterdam to build warchests to buy businesses.

In the case of ESM Acquisition Company, Davis, known as “Mick the Miner” is the chief executive and director.

Davis’s plan is to use his Vision Blue business to invest in smaller mining projects, while ESM will seek big investment opportunities, gearing up the $300 million with debt for the right opportunity.

Another sponsor of the SPAC is Texan private equity mining investor Energy and Minerals Group, which has 20 mining operations around the world.

Separately from the SPAC deal, Vision Blue today bought an $11 million stake in London Stock Exchange-listed Ferro-Alloy Resources, which is developing a vanadium mine in Southern Kazakhstan.

News of the investment is likely to spark a flurry of excitement among other smallcap mining stocks on the London market.

The SPAC launch could mark a comeback for Davis after his previous acquisition vehicle, X2, raised $5.5 billion but failed to do the big takeovers he had wanted to do.

X2 was quietly wound down in 2016 with investors’ money returned.

The Financial Times reported at the time that it came close to buying a group of coal mines from Rio but the deal failed to happen. X2 also reportedly sought to buy some mines from BHP but the company opted to spin them into a newly listed company called South32.

Sir Mick is one of the most famous tycoons in the industry, having built and run Xstrata until it was sold to Glencore amid acrimony in a contested 2013 takeover fight. The deal was finally brokered by former Prime Minister Tony Blair.

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