Fairstar ups value of Golden West takeover offer

Fairstair Resources Ltd has increased the value of its hostile takeover offer for iron ore developer Golden West Resources Ltd to $290 million, lifting its scrip offer to seven shares for every one Golden West share.

Fairstair had previously offered five of its shares for every one Golden West share.

Based on Fairstar's trading price today of 39 cents per share, the offer values Golden West scrip at $2.73 per share.

That is a substantial premium to Golden West's current price of $2.13 per share.

Fairstar also noted that it compared favourably with Golden West's recent share placement at a price of $1.85 per share.

Prior to the placement, Fairstar's voting power in Golden West was 32.2 per cent.