24/10/2008 - 14:46

Perilya, Chalice terminate project sale

24/10/2008 - 14:46

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Perilya Ltd will retain its Mount Oxide copper project after buyer Chalice Gold Mines Ltd asked for the acquisition deal to be terminated amidst the fall in commodity prices.

Perilya, Chalice terminate project sale

Perilya Ltd will retain its Mount Oxide copper project after buyer Chalice Gold Mines Ltd asked for the acquisition deal to be terminated amidst a fall in commodity prices.

Earlier this month, both companies had signed formal agreements for the all-scrip transaction, which was still subject to shareholder approval.

Under the deal, Chalice was to issue 200 million of its shares to Perilya. Shares in Chalice closed unchanged at eight cents while shares in Perilya closed steady at 15.5c.

Chalice advised that due to the severe downturn in capital markets and the recent substantial fall in the copper price, it could not go ahead with the purchase.

As a result, Chalice requested that Perilya terminate the agreement by mutual consent, which Perilya heeded to.

Both parties will bear their own costs in relation to the proposed transaction.

Perilya said it will consider all options and alternatives for "realising and maximising" the project's value.

Perilya is currently the subject of a hostile takeover bid by CBH Resources Ltd which has laid out two offers on the table.

CBH is offering 2.8 shares for each Perilya share if the Mt Oxide transaction goes ahead, or 4.2 shares for ever Perilya share if the sale of the project is not completed.

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