IMIC has offered to purchase all shares in Afferro for a consideration of £140m, which values each Afferro share between 115p and 140p.
The investment company expects to progress the transaction with a combination of shares as well as cash, which is yet to be raised, while the offer is subject to completion of satisfactory due diligence and other conditions.
IMIC, with already owns a 3.9% share of Afferro, announced in a recent statement that following the offer, it has not yet received a formal response from Afferro.
"There can be no certainty that any offer will ultimately be made or as to the terms of any such offer," the company said.
Afferro has confirmed the offer in a statement, saying it had received an initial approach from IMIC.
According to Afferro, the bid is at an early stage and the company cannot guarantee a formal offer at present.
"In addition, Afferro continues to have discussions with other interested parties regarding a possible offer for the issued and to be issued share capital of Afferro," the company stated.
The company stated that discussions are ongoing with another party, which precludes Afferro from initiating discussions with IMIC until 13 January 2013.
Afferro owns the Nkout, Ntem and Akonolinga iron ore projects in Cameroon, Africa, and a 70% interest in the Ngoa project located next to Nkout.