Photo by: Bloombeg
PERTH (miningweekly.com) – HQ Mining Resources Holding on Wednesday officially launched a A$7.1-million takeover offer for ASX-listed Golden Cross Resources.
HQ Mining, which already holds a 23.4% share in Golden Cross, was offering shareholders 7c a share for their holdings in Southern Cross.
The offer represented a 20.7% premium to the closing price of Golden Cross shares on the day before the takeover offer was flagged in October this year, and a 21.6% premium to the 30-day volume weighted average price of Golden Cross shares.
HQ Mining told Golden Cross shareholders that the all-cash offer provided certain value for their shareholding in Golden Cross, and would enable accepting shareholders to avoid subscribing for more capital, or their shareholding being diluted.
“Accepting shareholders will avoid the short-term risks associated with Golden Cross having to finalise funding for the prefeasibility of the Copper Hill mine, the mid-term risk associated with Golden Cross having to secure around A$130.5-million to A$163.5-million for the construction of a two-million to three-million tonne concentrator process plant at Copper Hill, and the long-term operating and project development risks associated with being a shareholder in Golden Cross.”
Golden Cross earlier this week flagged the possibility of raising some A$2.45-million to fund a prefeasibility study on the Copper Hill copper/gold project, in New South Wales.
The junior was hoping to place up to 20-million shares, priced at 7c each, to raise an initial A$1.4-million, while contracts for services to conduct the study would also be funded through the issue of up to 15-million shares.
HQ Mining’s takeover offer was subject to a number of conditions, including a 50.1% minimum acceptance condition and Foreign Investment Review Board approval.