JOHANNESBURG (miningweekly.com) – ASX-listed Mungana Goldmines on Friday again recommended that its shareholders not accept a 13.5c-a-share takeover offer from Auctus Chillagoe, pointing out that its two major shareholders have already indicated that they do not intend to accept the bid.
Kagara and Mungana, both of which are in liquidation, hold about 72.16% of the total Mungana shares on issue. The liquidators of the two major shareholders have indicated that the Auctus offer did not present a fair market value for their investment in the company and that they remained supportive of Mungana’s current strategy.
One of the conditions of the Auctus offer was a 90% minimum acceptance, which Mungana indicated would not be satisfied without Kagara and Mungana accepting the offer.
Last month, Mungana reported that an independent expert had found the offer to be neither fair, nor reasonable. The independent expert had assessed that a fair value for the company’s shares would be between 24.19c and 31.69c.
When Auctus launched its bid in April, it stated that the offer gave Mungana shareholders certainty of value and liquidity.
Mungana launched its North Queensland Zinc strategy in August 2014, following the acquisition of the Chillagoe zinc assets from Kagara (administrator appointed). The company also retains the gold rights for the same tenement package associated with its Mungana gold project.
Mungana is focused on developing the high-grade King Vol Zinc underground mine, which will include completion of the partially built Mungana processing facility. Once this is completed the company will expand its operations through continued exploration for gold and base metals at the highly prospective and underexplored Chillagoe district.