22/03/2010 - 08:41

Mesa to approve MinRes takeover bid

22/03/2010 - 08:41

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Mineral Resources intends to launch a takeover for manganese outfit Mesa Minerals with shareholders in the target split on Mesa's recommendation of the offer, with some saying the approval reflect the actions of a desperate board.

Mesa to approve MinRes takeover bid

Mineral Resources intends to launch a takeover for manganese outfit Mesa Minerals with shareholders in the target split on Mesa's recommendation of the offer, with some saying the approval reflect the actions of a desperate board.

Earlier today, Mineral Resources said it plans to launch a takeover bid for Mesa, offering one of its shares for every 70.6 Mesa shares.

Mesa's board have recommended the offer to shareholders, and directors have indicated they will accept the offer.

The takeover offer is conditional on either the withdrawal or defeat of all resolutions at an extraordinary meeting scheduled for later this week.

Last month, a group of Mesa shareholders with links to estranged joint venture partner and thwarted merger proponent, Auvex Resources, requested a shareholders meeting to put to a vote the removal of four of Mesa's five directors and replace them with three of its own nominees.

The dissident shareholders said they had become frustrated with Mesa's slow progress towards full-scale production and that the board was devoting too much effort to its own technological process for upgrading low-grade manganese.

Today, requisition shareholders spokesperson Guy Le Page said Mesa's immediate recommendation of Mineral Resources' offer is confusing.

"We are perplexed as to why the Mesa Board would recommend a takeover offer on the day of announcement," Mr Le Page said.

"We believe that the usual process for directors would be to recommend shareholders to take no action until details of the takeover offer can be reviewed and assessed by the Mesa Board. This would normally be on receipt of the bidder's statement.

"Importantly, the Requisition Shareholders are pleased that their actions appear to have focused the Mesa Board on the need to deliver shareholder value.

"However, we believe that the timing of today's takeover announcement should be questioned by Mesa shareholders."

He added that the requisition shareholders have no intention of withdrawing their push for the extraordinary meeting, to be held on Friday in Brisbane.

Mesa is currently attempting to move to full scale production at its Ant Hill and Sunday Hill manganese projects located south-east of Port Hedland.

Mineral Resources today said that its expertise in project development and operation will assist in the development of the projects.

The takeover offer has a minimum acceptance condition of 50.1 per cent of Mesa's shares and includes a break fee of $610,000.

Mineral Resources' takeover comes less than four months after it wrapped up its acquisition of Polaris Metals.

Shares in Mesa closed up 1.6c to 9.6c while shares in Mineral Resources closed down six cents to $7.18.

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