PERTH (miningweekly.com) – Takeover target Riversdale Resources is actively seeking alternate offers after an independent expert concluded that an offer from Australian iron-ore producer Hancock Prospecting is neither fair nor reasonable.

Hancock in March announced a A$2.20-a-share all-cash offer for the unlisted Riversdale, with the company prepared to increase its offer price to A$2.50 a share once its shareholding in Riversdale reached more than 50% before the close of the offer.

Hancock already holds a 19.8% share in Riversdale, which owns a coking coal project in Alberta, Canada.

While the board of Riversdale has urged shareholders not to take any immediate action, the company’s chairperson Michael O’Keeffe, as well as CFO Anthony Martin and shareholder Steve Mallyon, who collectively hold a 16.5% interest in the company, have said that they would accept the Hancock offer, subject to no superior bid arising.

Riversdale at the end of last week told shareholders that an independent expert had valued the company’s shares at about $2.56 to $3.05 a share, warning shareholders that should they accept the Hancock offer, they would lose the ability to benefit from a potentially superior proposal, should one eventuate.

The company has signed a number of confidentiality agreements, with several companies undertaking due diligence on Riversdale and its Grassy Mountain project.

Riversdale said that the interest received has confirmed the independent directors' view of the strategic value of the Grassy Mountain project, given the scarcity of high-quality coking coal assets. The project is projected to produce about 93-million tonnes of product coal over its currently proposed 24-year mine life.

While awaiting an outcome on potential proposals, Riversdale is advancing discussions with senior lenders for financing to develop the project area.

Hancock’s offer is set to expire on April 14, unless extended.