Subiaco-based diamond explorer Elkedra Diamonds NL will be acquired by Toronto Stock Exchange-listed Vaaldiam Resources Ltd for $55.4 million in scrip, enabling the Canadian to expand its presence in South America.
Elkedra shares were a third higher at close of trade, rising 33.3 per cent to close at 44 cents, after reaching a high of 48 cents earlier today.
The offer will see Vaaldiam issue 0.52 of its shares for every Elkedra share, which the Subiaco company said in an announcement would value Elkedra at 53 cents per share.
The company said the offer - which was given unanimous board approval - represented a 60 per cent premium to yesterday's closing price of 33 cents, valuing the company at $55.4 million.
Elkedra chairman Donald Best and executive director Sam Randazzo will join the Vaaldiam management team as Vice President of Operations and Vice President of Business Development respectively.
The offer is subject to no competing and more favourable bid being received and notice of a meeting will be issued to Elkedra shareholders in September.
Vaaldiam has also offered to fully acquire fellow Canadian company Great Western Diamond Corp, offering 0.45 of a Vaaldiam share for every Great Western share.
The Great Western Board has unanimously approved the offer.
