PERTH (miningweekly.com) – The board of ASX-listed Cradle Resources has urged shareholders to accept a A$55-million takeover offer from joint venture partner Tremont Investments.
Tremont, which holds a 50% interest in the Panda Hill niobium project, in Tanzania, was offering Cradle shareholders 33c in cash for each Cradle share.
The offer price represented a 43.5% premium to Cradle’s last closing price and a 37.3% premium to the company’s 20-day volume weighted average share price.
“This is a compelling proposal and provides Cradle shareholders with the opportunity to realise a significant premium,” said Cradle chairperson Ian Middlemas.
“The all-cash offer of 33c a share provides Cradle shareholders with certainty of value and an opportunity to realise their investment in full for cash. Tremont’s management team shares our vision for the development of the Panda Hill niobium project and, as such, we believe they are the right long-term partner for future customers, employees and other stakeholders in this capital intensive project.”
Cradle and Tremont have now entered into a scheme implementation agreement, subject to a number of conditions, including shareholder and Federal Court approvals, as well as regulatory approvals.
The Panda Hill project is expected to produce some 1.3-million tonnes of ore in its first four years of production, with output doubling to 2.6-million tonnes from year five.
The project will have average life-of-mine production of 5 400 t/y of niobium, and has an estimated pre-tax net present value of $796-million. The Panda Hill project is expected to require a capital spend of $196-million to develop.