PERTH (miningweekly.com) − The Australian Securities and Investment Commission (Asic) has obtained a court order preventing Hanlong Mining executives, including MD Steven Hui Xiao, from leaving Australia, while it investigates suspected insider trading activities in relation to ASX-listed Sundance Resources and Bannerman Resources.
The Chinese company made a A$1.4-billion bid for Sundance, which is developing an iron-ore project on the border of Cameroon and the Republic of Congo, and also offered to buy Bannerman, which owns uranium projects in Namibia, for $143-million.
Asic said on Tuesday that it had obtained ex parte orders on September 5, freezing the assets and restraining the travel of Xiao, as well as Hanlong VP Calvin Zhu, and employee Fan Zhang.
Freezing orders were also obtained for Xiao’s wife Xike Hu, FanFan Chen and Wingatta Pty Ltd, an entity associated with Zhang.
The corporate watchdog said that its investigation into possible insider trading was at an early stage.
The probe hit the stock of Hanlong’s two Australian takeover targets, with Sundance plunging 20% to a low of A$0.355 a share. By late afternoon, shares traded at A$0.40 a share.
This is below Hanlong’s cash offer of A$0.50 a share. The Chinese firm already owns 18.6% interest in Sundance.
The Perth-based explorer previously said it was also in discussions with a number of parties regarding a partnership deal for its 35-million-ton-a-year Mbalam iron-ore project. These discussions were likely to be finalised before Christmas.
Sundance refrained from commenting on the issue, apart from saying that the investigation did not relate to any of the company’s own personnel, or its conduct.
Bannerman, which is also listed in Canada, traded 10% lower at A$0.31 apiece in Sydney.
Hanlong made a A$0.612 a share offer for Bannerman, which the Australia-based explorer rejected as being too conditional.
Edited by: Mariaan Webb
Creamer Media Senior Researcher and Deputy Editor Online
EMAIL THIS ARTICLE