Further to Goldway Capital Investment extending the offer period to take over all the shares of coal miner MC Mining that it does not already own for A$0.16 apiece, Goldway has declared its offer as unconditional after increasing its interest in MC Mining to 83.67%.
In rand and pound terms, the offer consideration amounts to R1.96 and 8.3p a share, respectively.
The offer remains open for acceptance until April 22.
Given that the offer has been declared unconditional and control of MC Mining will pass to Goldway and its associates, MC Mining’s independent board committee (IBC) has advised shareholders to accept the offer, as Goldway will be able to exercise a compulsory acquisition of all remaining MC Mining shares if it acquires a relevant interest of 91% or more in the company.
The IBC has since the offer was first announced in December 2023 advised shareholders to not accept the offer, saying it undervalued MC Mining.
The committee also previously expressed frustration when Goldway, which comprises MC Mining’s biggest shareholders Senosi Group Investment Holdings and Dendocept, “failed to honour the best and final” statements that it previously made to shareholders by extending the offer period.
An independent expert from BDO Corporate Finance had echoed the IBC’s sentiment in that the value of an MC Mining share was closer to A$0.21 at the least and A$0.35 at best.
In its latest statement on April 10, the IBC, however, says there is no likelihood of an alternative bid or competing proposal on more favourable terms arising in the near term.
It also advises that Goldway intends to delist MC Mining from the ASX, the JSE and the Aim.
The IBC warns that if shareholders who have not yet accepted the offer do not do so before the offer lapses, they may, in the event that Goldway does not exercise compulsory acquisition rights, become minority shareholders in an unlisted, illiquid company and face difficulty in selling their minority shareholding off-market.
The committee elaborates that shareholders taking no action and waiting for their shares to be acquired by Goldway by way of a compulsory acquisition, face the uncertainty over whether Goldway will proceed with a compulsory acquisition.
Even if the compulsory acquisition is likely to occur, the receipt of any consideration from Goldway for the acquisition of shares under the offer will be at a significantly earlier date than any consideration payment from Goldway pursuant to a compulsory acquisition transaction, the IBC states.
MC Mining’s key projects include the Uitkomst and Vele collieries, as well as the Makhado and Greater Soutpansberg projects, in South Africa.