Mineral explorer Angus & Ross, which lost a reduced £803,000 last year, is talking to two 'very large companies' about a possible corporate deal, says chairman Robin Andrews.


According to Andrews, AIM-quoted A&R, which is lining up its Black Angel zinc play in Greenland for an AIM flotation, is now also discussing a hypothetical deal with two major groups, one Australian and one Canadian. 'I would not consider doing anything at less than 25p a share,' he insists – against today's 10.38p.


Whether these informal talks lead to anything concrete remains to be seen. A&R saw operating losses rise £200,000 to £1.1 million in the year to February, but reduced that to £802,567, helped by disposing of part of a subsidiary for £320,500.


Claiming cash of £2 million after various fundraisings before and after the company's year end, Andrews says he expects a pre-feasibility study of Black Angel (a major zinc producer from 1977 to 1990) to suggest developing an initial three million tonne deposit. This, he argues, could generate £2.5 million revenues and put an early value of £5.5 million to £11 million on Black Angel before going for the much bigger deposit the company envisages there.


Elsewhere, A&R expects drill results in November from its gold and tantalum projects in Brazil and has received approval from the Beijing authorities for joint ventures with local mining groups in China. The company is effectively turning itself into a mining investment holding company, argues former stockbroker Andrews, who hopes soon to appoint a heavyweight mining figure to the board.


Floated four years ago at 19p, A&R, whose broker and nominated adviser is John East, has been a lacklustre market performer, fluctuating between 14.5p and 7.5p over the past 12 months. Andrews says he is 'disappointed' at the lack of positive cashflow so far.


At 10.38p, valuing the company at £7.2 million, the shares clearly have spice on the chance that the Black Angel float and/or talks with major groups go well. They remain speculative at this stage.