PERTH (miningweekly.com) – Nickel miner Panoramic Resources on Friday launched an off-market takeover bid for ASX- and TSX-listed Magma Metals.

Panoramic, which is listed on the ASX, said it was prepared to pay Magma shareholders two of its own shares for every 17 shares held, implying a value of 14.94c a Magma share.

The offer represented an 86.8% premium to Magma’s closing price on February 2, and an 88% premium to the one-month volume weighted average price of Magma shares. It also represented a 206.7% premium to the market implied enterprise value of Magma’s exploration assets.

Magma shareholders accepting the offer would become part of a larger and more diversified Australia-listed company, with a current market capitalisation of some A$263-million, Panoramic said.

“Panoramic has a history of generating strong operating cash flows, profits and paying dividends to shareholders. Further, Panoramic has a highly experienced, multidisciplined management and operating team with a strong track record of project delivery and growing value for shareholders,” said chairperson Brian Phillips.

The takeover would also provide Magma shareholders with exposure to the potential upside within Panoramic’s portfolio of mining and mineral assets, including the Savannah and Lanfranchi operating nickel mines, in Western Australia, and a portfolio of gold, nickel, copper and other exploration projects.

Phillips said that as a standalone entity, Magma would continue to face the challenge of obtaining sufficient funding for its exploration and development activities in a volatile global economic market, arguing that the Panoramic offer provided shareholders with the opportunity to significantly reduce those funding risks.

The offer was conditional upon a 90% minimum acceptance, and Magma agreeing not to spin off its gold assets.

Panoramic already owns a 9.34% shareholding in Magma, which was currently focused on developing its flagship Thunder Bay North platinum-palladium-copper-nickel project, in Ontario.

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