21/02/2008 - 13:10

Perilya confirms merger talks with CBH

21/02/2008 - 13:10

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Base metals miner Perilya Ltd has confirmed it is in merger talks with CBH Resources Ltd, as the miner continues its strategic review.

Perilya confirms merger talks with CBH

Base metals miner Perilya Ltd has confirmed it is in merger talks with CBH Resources Ltd, as the miner continues its strategic review.

Prompted by recent media speculation, Perth-based Perilya said today that its discussions with CBH were incomplete and confidential.

"Discussions regarding a potential merger between the two parties have taken place," the company said.

"No formal agreement has been reached nor is such an agreement imminent or inevitable."

In a separate announcement, CBH said confidential discussions had been and were ongoing with Perilya regarding a possible corporate transaction which "centres on maximising the value of the respective group's Broken Hill operations."

CBH said these discussions were incomplete and, if and when any agreement were reached, the market would be advised.

Perilya announced earlier this month that it had appointed chairman Patrick O'Connor to oversee a strategic review of the company during the March quarter of 2008.

The company said the review would cover corporate and operational activities and its objective was to refine its growth strategy to optimise the operational performance of its existing assets and to pursue merger and acquisition opportunities.

Perilya is investing substantially in the development of its three major projects located in the Broken Hill, Mt Isa and Flinders regions of New South Wales as well as exploration in the surrounding tenements.

The company is expanding its operations at the Broken Hill mine through the development of an exploration decline at Potosi, re-developing the North mine via a development decline, conducting an open pit feasibility study into the Flying Doctor deposit and conducting exploration within a ten kilometre radius of the concentrator.

Since 2007, Perilya has mined and stockpiled approximately 100,000 tonnes of contained zinc in the form of high grade zinc silicate (oxide) ore at the Beltana deposit located in the Flinders project in South Australia.

It is currently conducting a feasibility study into a similar project at the adjacent Reliance deposit.

The company is also targeting a 200,000 - 250,000 tonnes copper resource through extension drilling at its 203,000 tonne Mount Oxide copper project in the Mt Isa region in Queensland.

Perilya's exploration and development interests also extend to the state of Sabah in Malaysia.

CBH Resources' shares jumped seven cents or 20 per cent on the news to close at 42 cents, while Perilya dipped nine cents or 4.75 per cent to $1.805.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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