Metals X matches late gold bid

Metals X has been forced to increase the price it is paying for Reed Resources' Meekatharra gold project to $9.9 million after administrators announced a surprise competing bid had been lodged just before a creditors’ meeting on Thursday.

The revised deal was approved at a creditors’ meeting for Reed subsidiary GMK Exploration, which owned the Meekathara project.

GMK administrator Ferrier Hodgson was legally silenced on exposing the name of the offering party, but advised that it was genuine and the bidder was well funded and financially capable of completion.

“We were extremely surprised that a conditional offer from an undisclosed party was put forward at the last minute to potentially scuttle a fully funded, disclosed and agreed purchase by Metals X,” Metals X managing director Peter Cook said. 

The company agreed on a total acquisition price of $9.4 million in cash and 24 million shares in Reed Resources, with a market value of about $500,000.

The original purchase price, announced a month ago, was $7.7 million.

“The purchase price remains astounding value when compared with the $120 million in capital expenditure we would require to build a new plant for our own ores,” Mr Cook said. 

“Even with a slightly higher purchase price, this remains a great acquisition for Metals X and a major step forward for our plans to bring our Central Murchison gold project to fruition.”

Metals X’s share price rose by 2.75 per cent to 26.2 cents at 2:20pm WST.