The board of Explaurum has rejected a $59.2 million hostile takeover bid from gold miner Ramelius Resources, saying the offer is opportunistic and undervalues the target.
Ramelius lobbed its scrip bid last month, which valued Explaurum at 12.3 cents-per-share, a 66.2 per cent premium on its last closing price.
“The timing of the offer is highly opportunistic and made at a time when not all potentially material information is available to Explaurum shareholders,” he said.
“By accepting the offer without all potentially material information, Explaurum shareholders risk making a decision which is not fully informed and will not be able to accept a superior offer from another bidder if such an offer is made.
“Ramelius' plan for the future development and operation of the Tampia project and the Mace Discovery is uncertain.”
Mr Baker said the company earlier attempts to negotiate a deal had not been successful.
“In the week prior to the opportunistically timed hostile offer Explaurum did engage in good faith with Ramelius,” he said.
“Given the tone and content of that meeting, your board was surprised, and concerned, when Ramelius abruptly discontinued discussions.
“They declined the opportunity to enter due diligence and the opportunity to be in a better position to assess value, and elected to proceed with their unsolicited and highly opportunistic offer to the market.”
The John Lawton-led company is focused on its Tampia Hill gold project, which is located 240 kilometres east of Perth.
The project is about 130km south of Ramelius’s Edna May mine, which was acquired in October last year.
Edna May is a single-pit operation feeding an adjacent processing plant.
Explaurum released a feasibility study on Tampia Hill in May, which detailed a $119 million capital cost.
Shares in Explaurum finished ahead 4.55 per cent at 12 cents each today.