UPDATE 2-Miner Afferro agrees to $190 mln offer from IMIC

Wed May 22, 2013 8:38am EDT
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* IMIC pledges to overcome mine's infrastructure problems

* Afferro's strategy was flawed, says CEO

By Stephen Eisenhammer

LONDON, May 22 (Reuters) - West Africa-focused miner Afferro has agreed to a $190 million cash-and-paper offer from investment group IMIC that could pave the way for development of its flagship iron ore project.

The deal is unique because IMIC has already sealed a partnership with China - a major potential buyer of the ore - to build transport links so the raw material can be exported.

IMIC, allied with African Iron Ore Group run by Afren founder Bert Cooper, teamed up with a unit of China Railway Group to develop the infrastructure around Afferro's most important asset, the Nkout iron ore project in Cameroon.

"The issue with West and Central Africa is infrastructure. The deposit is there but the infrastructure is not so you're not able to bring the product to market," Haresh Kanabar, chairman of IMIC, told Reuters. "We identified that ... and started building strategic partnerships with large multi-billion dollar Chinese corporations."

BHP cast doubt on the prospects of dozens of West African iron ore projects when it decided earlier this year to pull out of its Mount Nimba project in Guinea.

But the IMIC-Afferro deal has the potential to open up a vital transport corridor for southern Cameroon and the Republic of Congo.   Continued...