Gold miner Resolute Mining has acquired a 20 per cent stake in Noble Mineral Resources, while at the same time making an $85 million financing proposal designed to trump a similar offer from China's Zhongrun Group.
Resolute announced today that it had executed share sale agreements to acquire a 19.9 per cent stake in Noble, offering one Resolute share in exchange for every 12 Noble shares held.
Resolute also submitted an $85 million financing offer to Noble, to fund the development of the Bibiani gold project in Ghana.
The share sale agreements and financing offer are conditional on Zhongrun's proposed investment in Noble not proceeding.
Zhongrun announced late last month that it was poised to invest $87.7 million in Noble, taking a 42 per cent stake.
Noble is seeking the funds to ramp up production at Bibiani to more than 150,000 ounces per year.
The project has produced more than 5,500 ounces of gold to date.
Resolute chief executive Peter Sullivan said the company believed its offer to be clearly superior to Zhongrun's.
"The Zhongrun transaction essentially hands control of the company over to Zhongrun, leaving existing shareholders as a highly diluted minority," Mr Sullivan said.
"In contrast, Resolute is proposing to provide Noble shareholders with the opportunity to not only participate in the capital raising and maintain their shareholdings at current levels, but also benefit from our extensive experience operating gold mines in Africa.
"The value of that experience to Noble and its shareholders in their current predicament should not be underestimated."
At 1:20PM, WST, Resolute shares were down 4 per cent, trading at $1.81, while Noble's stock was up 12 per cent, at 14 cents.