Fairstar Resources Ltd has announced that acceptances for its off-market takeover bid for Golden West Resources Limited have now increased further to a total of 33.73% of the issued capital of Golden West.
Golden West Resources Ltd has formally rejected the hostile takeover offer lodged by Fairstar Resources Ltd, which has accumulated a 33.7 per cent stake in its takeover target.
In a target's statement issued today, Golden West's independent directors said the Fairstar offer:
- undervalues the company;
- will significantly dilute shareholders' interests in Golden West's Wiluna West Iron Ore Project;
- does not offer access to any other substantial assets or increased capability within the combined entity;
- does not bring any meaningful cost synergies; and
- will incur substantial costs that will deplete Golden West's financial resources.
Fairstar's Offer is subject to Fairstar receiving acceptances of more than 50% of the Golden West shares on issue, as well as other conditions set out in the Bidder's Statement.
The level of acceptances for Fairstar's takeover Offer for Golden West has continued to rise; from 19.8% when Fairstar launched its Offer on October 15, to 27.69% announced last Friday, to the current figure of 33.73%.
Fairstar managing director Mr Kevin Robertson said that the continued support shown via the increasing level of acceptances was an extremely positive indication that a significant number of Golden West shareholders believe in Fairstar's takeover Offer and its plans to advance shareholders' future value.
"We continue to be buoyed by the increasing level of acceptances and support for our Offer, and the strategy we have in place for the future development of the assets of both companies," Mr Robertson said.
Golden West, meanwhile, has renewed calls for shareholders to reject the unsolicted scrip takeover offer from Fairstar.
The company considers the Fairstar offer to be inadequate and one which provides no upside benefit to progress the development of the Wiluna West Iron project.
Golden West said it had already received irrevocable written undertakings from shareholders representing 27.85% of the company's shares that they intend to reject the offer from Fairstar, including two of the company's major
shareholders, Falak Holding LLC and the Francke group of shareholders.
Fairstar's offer remains open until December 13.