Source: AP News
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  • Myanmar Metals (MYL) receives a buyout offer from China-based Yintai Gold Co
  • At 3.5 cents apiece for all Myanmar Metals shares, the offer values the company at around $66.5 million
  • The bid comes as deposed leader Aung San Suu Kyi is placed on trial in Myanmar following months of violence since this February’s military coup
  • MYL shares have been halted since the coup and last traded at 7 cents on February 1

A China-based miner has thrown in a tepid buyout offer for Myanmar Metals (MYL) just days after deposed leader Aung San Suu Kyi was put on trial in the nation from which the company takes its name.

Ms Suu Kyi was pulled from office by a military-led coup in February over her election win back in November last year. Her arrest and the ensuing protests sent the nation into turmoil and threw Myanmar Metals’ long-term plans in the region into question.

According to the Assistance Association of Political Prisoners (Burma), 818 people have been killed in the protests following Ms San Suu Kyi’s arrest.

Following the coup trading in MYL shares was halted, as were moves to further expand the company’s holdings in the region while it backed out of two planned acquisitions. This left the company with only its 51 per cent stake in the Bawdwin lead and silver mine in the nation’s Shan state.

In an update to the market in March, the company made a clear intension to back out of Myanmar amid its escalating geopolitical tensions and said it was evaluating its strategic options regarding the Bawdwin mine.

The company’s relationship with the project was further complicated weeks later when an exposé by The Sydney Morning Herald highlighted previous connections between one of the project’s joint venture partners Win Myint Mo Industries and infrastructure giant Asia World. The founder of Asia World faced money laundering charges and accusations of links to Myanmar’s military in the years leading up to the coup.

In the months since MYL investors haven’t heard much more, until today when Yintai Gold Co — a part of China-based Yintai Group — offered to buy all of Myanmar Metals’ shares for just 3.5 cents apiece, valuing the company at around $66.5 million.

While this offer prices MYL’s shares at just half their last traded price, the actual market value of the company remains undetermined, as it has yet to emerge from a five-month trading halt.

The bid from Yintia arrives amid concerns held by US and Australian government officials about increasing levels of Chinese ownership in Myanmar. The troubled nation is a key link in China’s long-term Belt and Road Initiative, which aims to connect hundreds of countries from Asia to the Middle East, Africa and Europe.

This has made the region particularly attractive the China-based operators hoping to the benefit from the initiative’s expansive infrastructure plans.

China — alongside Russia — blocked a UN condemnation of coup earlier this year and has appeared reluctant to allow other countries to interfere with its operations in the South East Asian nation, previously criticising plans for global sanctions on the current military-led junta.

All that said, Yintai’s offer remains non-binding and conditional until due diligence can be completed, a task Myanmar Metals admits will be difficult “due to the political situation in Myanmar and restrictions on travel due to the COVID-19 pandemic”.

Therefore, it is unlikely for the deal to go ahead quickly, leaving the small Perth-based mineral explorer still under the cloud of the region’s jostling geopolitical forces.

MYL shares have been halted since the coup broke out and last traded at 7 cents on February 1.

MYL by the numbers
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