27/03/2019 - 09:32

Lynas rejects Wesfarmers' $1.5bn offer

27/03/2019 - 09:32

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Lynas Corporation said it will not engage with Wesfarmers' $1.5 billion indicative takeover offer, after the conglomerate launched the bid for the rare earths miner yesterday.

Lynas rejects Wesfarmers' $1.5bn offer
Lynas said its Mt Weld ore body is a tier 1, long life, high-grade asset.

Lynas Corporation said it will not engage with Wesfarmers' $1.5 billion indicative takeover offer, after the conglomerate launched the bid for the rare earths miner yesterday.

In a statement to the ASX, Lynas said it had assessed the proposal and "concluded that it will not engage with Wesfarmers on the terms outlined in the indicative and highly conditional proposal".

Lynas said it was "unique" and its "value is derived from strong, irreplaceable assets" as the only significant rare earths miner and processor outside China.

It said its Mt Weld ore body is a tier 1, long life, high-grade asset, and the company has substantial substantial in-house capability and intellectual property.

Yesterday, Wesfarmers said it was uniquely placed to support Lynas’ future through further capital investment to support downstream processing assets and realise the full potential of the Mt Weld ore body, located near Laverton.

The all-cash Wesfarmers offer at $2.25 per share was a 44.7 per cent premium to Lynas's previous closing share price of $1.56.

The Lynas share price has been highly volatile over the past year, reflecting regulatory issues it has faced in Malaysia and its inconsistent financial results - they have traded as high as $2.90 in May last year and as low as $1.50 in January.

Shares in Wesfarmers were down 0.27 per cent to trade at $33.71 each at 12.05pmAEDT.

Shares in Lynas were up 1.43 per cent to trade at $2.13 each at 12.05pmAEDT.

 

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