Aim-listed Kopane Diamond Developments, which has assets in Finland and Lesotho, has decided not to enter into talks regarding a possible takeover of the company, after having received an indicative proposal from an unnamed third party, of 17p a share.

Although the offer was a premium to the company's share price of around 10p before Friday's statement, Kopane's board believed that it still did not reflect the future prospects of its Liqhobong diamond project in Lesotho, the firm said on Friday.

Further, the company behind the proposal had said that the offer would only be valid if Kopane did not go ahead with the equity capital raising announced last month.

The firm said three weeks ago that it would place up to 70-million new ordinary shares at 10p a share to raise about £6,6-million, to fund a feasibility study on the Liqhobong project.

“Given Kopane's significant short-to-medium term funding requirements for its definitive feasibility study, the board considers that the pursuit of this takeover approach, whose terms are conditional upon discontinuing the current placing, would not be in the best interests of Kopane nor its shareholders,” the company said.

Shares in Kopane rose 22% on Friday, to 12,5p a share.

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