PERTH (miningweekly.com) – A third bidder has emerged for ASX-listed Cardinal Resources, offering A$1.05 a share in an unsolicited and off-market takeover offer.
Ghanian firm Engineers & Planners Company has formally launched an all cash offer for Cardinal Resources in order to obtain the company’s mining interest in Ghana.
The Ghanian firm has previously noted that with the acquisition of Cardinal’s Namdini project, the company could deliver a Ghanaian owned modern mining project to create thousands of jobs and maximise Ghanaian revenues.
A previously completed feasibility study estimated that Namdini would produce some 4.2-million ounces of gold over a mine life of 15 years, with an estimated 1.1-million ounces expected over the first three years of the operation. Namdini is expected to cost $390-million to develop.
The Engineers & Planners bid is subject to a 50.1% minimum acceptance conditions, as well as regulatory approvals, including Foreign Investment Review Board approval.
Cardinal has urged shareholders not to take any action in relation to the Engineers & Planners bid, while the offer is being considered.
The ASX-listed company noted that throughout the first half of 2020, it was engaged in a strategic process and engaged with, and received, a number of early stage proposals from a number of different parties, including, an early stage asset level proposal that was expressed to be subject to contract from Engineers & Planners.
The new takeover offer effectively breaks a stalemate between suitors Nordgold and Shandong Gold Mining, who have been locked a A$1 a share offer for Cardinal after both companies issued a last and final statement.
Shandong on Tuesday increased its offer price for Cardinal also to A$1.05 a share, saying it considered the Engineers & Planners offer to be a higher competing offer.
However, Russian suitor Nordgold has argued that the Engineers & Planners bid was not an ‘offer’ and was not a ‘higher competing offer’, nor was it an intention to make a higher competing offer, with Nordgold saying on Tuesday that the third bid did not have the effect of freeing either of the other two suitors from their best and final statements.
“In the present circumstances, Nordgold considers that a bid which is not an unconditional fully funded cash bid is unlikely to constitute a competing offer for the purposes of the best and final statements,” the gold miner said.
“The Engineers & Planners bid does not comply with law and consequently does not constitute an offer. Among other things, the bidder’s statement does not contain the written offer terms, does not provide Cardinal shareholders with a method of acceptance, and contains terms inconsistent with the requirements for an off-market bid,” the Russian suitor said.
Furthermore, Nordgold pointed out that due to the highly conditional nature of the Engineers & Planners’ bid, and the fact that the Ghanaian firm had not demonstrated sufficiency of funding, the bid could not be classified as a ‘higher competing offer’.