Mineral Resources’ leader Chris Ellison has called on Norwest Energy shareholders to accept his “generous” $431 million takeover offer after the target’s board recommended rejecting the bid.
Mineral Resources’ leader Chris Ellison has called on Norwest Energy shareholders to accept his “generous” $431 million takeover offer after the target’s board recommended rejecting the bid.
In the ASX statement released today, MinRes said the Perth Basin asset had significant risks and Norwest did not have the balance sheet to support future development.
“The MinRes offer is generous considering that only one well has been drilled and the inherent risks associated with additional drilling and resource definition,” Mr Ellison said.
“The target’s statement itself acknowledges there’s a risk in holding onto Norwest shares if the results of the drill campaign are below expectations.
“By rejecting our compelling offer without providing any alternative valuation, the Norwest board is failing its shareholders.”
Earlier this month, Norwest announced its directors unanimously recommended shareholders reject the MinRes takeover offer, which was announced in December.
In the ASX statement, the Norwest board said MinRes was seeking to secure control of the company and its Perth Basin assets without paying an appropriate premium.
MinRes’ most recent offer represents a 43 per cent premium on Norwest’s December share price.
The lithium and iron ore miner is Norwest’s biggest shareholder with a 19.9 per cent stake in the company, and a joint venture partner in the Lockyer Deep gas project in the Perth Basin.
MinRes’ offer is currently the only one of the table for the company and Perth Basin play.
Mr Ellison said his company had the means to get the project under way.
“We've got the balance sheet and team to get this project done, and a portfolio of assets that will underpin strong growth for decades to come,” he said.
“By accepting our offer, Norwest shareholders will maintain exposure to Lockyer Deep, as well as MinRes’ world-class portfolio of iron ore, lithium, mining services operations and our highly prospective energy position in the Carnarvon Basin.
“Accepting the offer will enable Norwest shareholders to capture value in a potentially tax-effective manner and be part of the next exciting chapter of MinRes’ growth.”
At close of market, MinRes shares were up 0.42 per cent at $88.06.
Norwest shares were down 5.63 per cent at 6.7 cents.
