Golden West surges on takeover bid

Shares in Golden West Resources Ltd surged more than six per cent today after junior explorer Fairstar Resources Ltd launched a scrip-only takeover bid for the emerging iron ore producer.

Golden West shares climbed 13 cents, or 6.3 per cent, to $2.18 pushing its market value to $155 million after Fairstar made the off-market bid for its shares.

Fairstar, which has a market capitalisation of $39 million, said it was offering five fully paid Fairstar shares for every share held in Golden West.

Gold and uranium explorer Fairstar shares ended 1.7 per cent higher, or 1 cent, to 61 cents.

Fairstar listed on the Australian Securities Exchange in October 2006 after raising $7.5 million through the issue of 25 cent shares.

Golden West floated on the ASX in December 2004, initially as a gold explorer before turning its primary focus to iron ore after discovering good potential for ore development at its Wiluna West project.

Golden West has said it thinks its Wiluna West iron ore project could host in excess of 200 million tonnes of ore.

Since Fairstar was established in mid-2005 it has accumulated exploration projects prospective for gold and uranium in the Yilgarn Province of Western Australia.