19/01/2018 - 14:52

Mercantile increases Bauxite bid

19/01/2018 - 14:52

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Sir Ron Brierley-chaired Mercantile Investment Company has increased its bid for Perth-based Bauxite Resources to 11 cents, putting it within the price range set out in the independent expert’s report.

Sir Ron Brierley-chaired Mercantile Investment Company has increased its bid for Perth-based Bauxite Resources to 11 cents, putting it within the price range set out in the independent expert’s report.

In November, Mercantile put in a 9-cents-a-share offer for a 50 per cent stake in Buaxite, which was rejected by the board following the independent report from BDO.

BDO gave a preferred valuation of 12.1 cents with a range of 11 to 13.3 cents.

Shares in Bauxite have traded as low as 7 cents in November and have been at 9 cents since mid-December.

In December, Bauxite said the offer did not provide an adequate premium for control of the company and that funding for the offer was uncertain.

Mercantile currently holds a 3.7 per cent stake in Bauxite and has decided to increase the offer to 11 cents, while also extending the offer period until February 28.

At that price the deal would be worth about $12.7 million.

Shares in the company rose 14 per cent today to be trading at 10 cents at the close.

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