SINGAPORE (July 2): Shares in BlackGold Natural Resources surged 66.7% when markets opened Thursday morning following the announcement of its proposed strategic business collaboration and acquisition of the company by Indian conglomerate S Lad Group on Wednesday evening, after markets closed.

BlackGold announced Wednesday that it received a letter of intent (LOI) from S Lad Group for a proposed strategic collaboration on the company’s mining assets, and acquisition of the company.

The S Lad Group is led by the former minister of government of Karnataka, Shri. Shantosh S Lad, and is one of the oldest and largest suppliers of iron ore from the South Indian state of Karnataka.

The group has over five decades in the mining business, and it has since diversified its business into several units including the manufacturing of pig iron.

In an SGX filing on Wednesday, BlackGold says the potential collaboration will allow its operations to tap on S Lad Group’s extensive experience, and create new market opportunities in India.

“The S Lad Group’s letter of intent marks an exciting development for BlackGold because both companies share a commitment to support the long-term growth prospects of energy demand in Asia,” says Soh Sai Kiang, chairman of BlackGold.  

“As the Group proceeds with negotiations and formulating a response to the LOI, it is envisioned that the proposed transaction, when brought to fruition, will mean significant longterm potential for synergies and multiple growth levers to expand our markets and range of commodities including iron ore,” he adds.

As at 9.13am, shares in BlackGold are changing hands 0.8 cents higher, or 66.7% up, at 20 cents.