JSE-, ASX- and Aim-listed coal miner MC Mining says a report prepared by an independent expert from BDO Corporate Finance that the takeover offer it received from Goldway Capital Investment in December is neither fair nor reasonable to shareholders.

“We consider the offer to be not fair because the value of the offer consideration is less than our assessed low, preferred and high value of an MC Mining share.

“We consider the offer to be not reasonable for shareholders because the advantages of accepting the offer do not sufficiently outweigh the value differential between the value of an MC Mining share and the value of the offer consideration,” BDO states in its report.

BDO assessed the value of an MC Mining share prior to the Goldway offer at A$0.21 (low), A$0.28 (preferred) and A$0.35 (high), compared with the A$0.16 a share offered by Goldway.

Further, it states that the advantages of accepting the Goldway offer include that shareholders will receive A$0.16 a share in cash, which could be used in alternative investments; and offers an opportunity for shareholders to exit the coal market.

The disadvantages, meanwhile, include that shareholders will not be able to access any returns generated by MC Mining’s assets, namely the Makhado project, Uitkomst, the Vele colliery or the Greater Soutpansberg project.

Also, shareholders will lose this exposure to the coal industry and, with limited listed coal producers and low levels of liquidity for coal companies, shareholders may not be able to replace this investment with exposure to a superior coal asset, BDO states.

MC Mining’s Independent Board Committee (IBC) previously described the offer as opportunistic and not reflective of the value of MC Mining.

In MC Mining’s latest supplementary target statement, the company and its IBC maintain that shareholders should not accept the A$0.16 a share cash off-market takeover offer.

The offer remains open until April 5 unless it is extended or withdrawn by Goldway.

Goldway is a consortium comprising MC Mining’s biggest shareholders – Senosi Group Investment Holdings and Dedocept.

Another offer made by coal miner Vulcan Resources to take over MC Mining at between A$0.17 and A$0.20 apiece has been withdrawn.