WA miners' takeover battle heats up
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The bidder for goldminer Gascoyne Resources has sought orders from the Takeovers Panel to address matters related to a conflicting merger with Firefly Resources.
In its submission, Westgold Resources said shareholders in Gascoyne were being denied the opportunity to consider the takeover proposal within a reasonable timeframe, as the target continued to progress its merger with explorer Firefly.
Their shareholders are due to vote on the merger on October 21.
Meanwhile, Westgold is offering one of its shares for every four shares held in Gascoyne, which today would value the target at about $120 million.
But the Gascoyne board recently recommended shareholders reject the offer, having said it was not a superior alternative to the Firefly deal.
That’s despite Westgold claiming its offer is superior and labelling the Firefly merger “highly dilutive”.
Westgold in its submission to the Takeovers Panel claimed the board of Gascoyne was unable to support a superior offer, having described the exclusivity provisions in the scheme implementation deed with Firefly as “illusory”.
It also claimed Gascoyne didn’t have a “contractual ability of its own volition” to terminate the merger.
The bidder has sought interim orders from the panel, including that the scheme implementation deed be amended to contain a termination right to Gascoyne.
Westgold, which operates three mines in the Mid West, also requested the Firefly scheme meeting be postponed so Gascoyne’s shareholders could consider the takeover offer.
Through the merger, announced in June, Gascoyne was planning to consolidate Firefly’s Yalgoo project into its nearby Dalgaranga operations where mining is expected to continue until early 2025.
Westgold claims its offer reduces uncertainty and risk around the longevity of the operation, as well as the future of Gascoyne’s Mt Egerton and Glenburgh projects.
Gascoyne closed up 1.3 per cent on the ASX on Thursday to trade at 38 cents.
Westgold’s shares closed up 3.2 per cent to trade at $1.96.