Nickel and copper explorer and developer Noront Resources on Thursday announced that it had adopted a shareholder rights plan, in the wake of Wyloo Metals’ announcement this week of a proposed unsolicited offer.
The rights plan was designed to ensure that Noront shareholders were treated fairly in connection with any takeover bid and to protect against “creeping bids” for the outstanding common shares through purchase exempts from applicable takeover bid rules, the takeover target said in a statement.
Holders of the rights, other than the acquiring person and its related parties, would be permitted to exercise their rights to purchase additional common shares at a 50% discount to the then prevailing market price.
The plan also provided for one right attached to each issued and outstanding common share.
The plan became effective on May 26, but was subject to ratification by shareholders and approval of the TSX-V.
Wyloo, which is owned by Australian billionaire Andrew Forrest, announced this week that it would make an offer of C$0.315 a share for the remaining shares in Noront, which would value the company at C$133-million.
Noront’s stock closed at C$0.32 a share on Thursday.
Wyloo made its initial investment in Noront in December and has since stepped up investments in critical battery-related commodities.
Noront has ownership of, or a controlling interest in, all the major discoveries in the Ring of Fire – an emerging multi-metals area located in the James Bay Lowlands of northern Ontario.
The company’s first project is a 100%-owned, high-grade, nickel, copper and platinum group elements deposit called Eagle’s Nest. It is the largest high-grade nickel discovery in Canada since Voisey’s Bay and the most advanced project in the Ring of Fire.
The other projects in its pipeline are the Blackbird and Black Thor chromite deposits in conjunction with a ferrochrome production facility in Sault Ste. Marie.