15/09/2020 - 12:00

Cardinal directors accept $566m Shandong offer

15/09/2020 - 12:00

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The directors of Perth-based Cardinal Resources have accepted a takeover proposal from Chinese company Shandong Gold, ahead of a competing bid from Russian-owned Nordgold.

Cardinal directors accept $566m Shandong offer
Cardinal's flagship asset is the 5.1 million ounce Namdini gold project in Ghana. Photo: Cardinal Resources

The directors of Perth-based Cardinal Resources have accepted a takeover proposal from Chinese company Shandong Gold, ahead of a competing bid from Russian-owned Nordgold.

It comes about a week after Shandong offered to buy Cardinal for $1 per company share, trumping a 90-cent proposal by Nordgold in July.

Cardinal told the market today that its directors, who collectively hold about 6 per cent of the company's shares, have eached instructed their brokers or controlling participants to initiate acceptance of the latest offer from Shandong, which values Cardinal at about $556 million.

Cardinal has endorsed recent offers from Shandong, noting that a deal with the Shanghai and Hong Kong-listed company can be satisfied within a reasonable time frame.

Shandong has already received all Chinese and Australian regulatory approvals to proceed with its takeover of Cardinal.

The deal is now only subject to other conditions including a 50.1 per cent approval from Cardinal shareholders.

Cardinal, whose flagship asset is the 5.1 million ounce Namdini gold project in Ghana, has previously said it does not have the substantial capital required to bring Namdini to production.

The project's initial capital costs estimated to be $US390 million.

Cardinal  were down 1 per cent at 12:49pm AEST to trade at $1.04.

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