PERTH (miningweekly.com) – ASX-listed Wesfarmers on Tuesday confirmed that it had engaged in discussions with the Malaysian government over takeover target Lynas, but dismissed suggestions that it had interfered with government processes.
The company, which wants to buy the rare earths miner for A$1.5-billion, said it engaged with Malaysian officials to “better understand” the licensing and regulatory regime affecting Lynas’ operations in that country.
Wesfarmers said in a media release that it was “disappointed in the mischaracterisation” of its discussions with the Malaysian government, and rejected any inference that these discussions were “inappropriate” or intended to interfere with the government process.
Wesfarmers has been criticised for engaging with the Malaysian government on the future of Lynas, with its actions said to raise governance concerns.
At the weekend, the Malaysian Prime Minister Mahathir Bin Mohamad made comments regarding the future of the Lynas operation, and the need for raw materials to only be imported into Malaysia after initial processing.
As a licence condition, this would require Lynas to undertake the cracking and leaching process offshore.
Wesfarmers told shareholders that Lynas’ statements that it was planning various options to geographically diversify its processing, addressing the licensing issue, was positive progress.
Wesfarmers last week launched a A$1.5-billion takeover offer for Lynas, offering shareholders in the company A$2.25c a share in cash for all the shares held.
After evaluating the indicative, nonbinding and highly conditional takeover proposal, Lynas took the decision not to engage with Wesfarmers.