PERTH (miningweekly.com) – The directors of ASX- and TSX-listed Cardinal Resources have advised shareholders not to take any action on an increased offer from suitor Nordgold, after it upped its cash offer from 60c a share to 90c a share.
Cardinal has previously backed a rival offer from Shandong Gold Mining, which is offering shareholders 70c in cash for each share not already held.
The Shandong offer is subject to a 50.1% minimum acceptance condition, with the Foreign Investment Review Board (FIRB) having already granted approval.
Cardinal told shareholders on Wednesday that while the 90c a share cash offer by Nordgold was higher than the offer made by Shandong, Cardinal had certain obligations under the bid implementation agreement signed with Shandong, including matching rights in favour of Shandong.
The company has urged shareholders not to take any action with regard to the increased offer from Nordgold, until a further update could be given.
Cardinal holds an interest in a number of tenements in Ghana, and is currently focused on the development of its Namdini project, which has an ore reserve of some 5.1-million ounces.
A feasibility study into the project estimated that it 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.