It’s been a busy week at Gemfields PLC (LON:GEM) after the board of the emerald and ruby miner reluctantly recommended an offer from Chinese conglomerate Fosun Gold on Tuesday.
The 45p a share cash offer was deemed to be better than the nil-premium bid the company’s majority shareholder, Pallinghurst Resources, submitted last month, although Gemfields said both undervalued the business.
However, the Pallinghurst offer has the backing of 61.25% of Gemfields shareholders and now just needs the support of its own investors to push ahead with the deal. That vote is on Monday (26 June).
As Fosun is only interested if it can take at least a 50% stake in Gemfields, the only way for its bid to prevail is if Pallinghurst shareholders vote against the acquisition, but Pallinghurst believes it’s already secured backing from 50.3% of investors.
The story takes another twist though, with Gemfields disputing that level and suggestions that the bidding war may rumble on regardless of what happens on Monday.
Shanta Gold Ltd (LON:SHG) has unveiled a series of transactions that should utterly transform the Tanzania-focused miner.
It is acquiring Vancouver-based Helio Resource Corp for US$5.6mln; it is raising US$14mln from investors, and it has agreed a debt restructuring deal that significantly reduces the coupon on those borrowings.
The takeover first: Shanta has agreed to hand over 59.5mln shares in the company to take control of Helio, which owns the property next to its New Luika Gold Mine.
The plan is to incorporate the newly-acquired area into the mine plan with the potential to expand the rate of production, while exploring for more gold.
The expansion will be supported by a US$14mln equity fundraiser, which has the backing of cornerstone investor Odey Asset Management, run by the hedge fund guru Crispin Odey.
At the same time the company has agreed to restructure its existing debt after receiving a commitment letter from Investec Bank for a US$50mln facility.
The new borrowings will replace an existing US$40mln debt deal of which just over US$35mln was drawn.
Russia –focused gold miner Petropavlovsk PLC (LON:POG) has appointed Ian Ashby as its new chairman to replace founder and mining veteran Peter Hambro.
Hambro was voted out of office at the company’s annual general meeting on Thursday after he was opposed by a group of shareholders speaking for over 30% of the shares.
Ashby was voted in at the AGM yesterday as was Bruce Buck, who takes over as senior independent director.
Two other directors, Vladislav Egorov and Garrett Soden, also joined the board.
Over in Kenya and Goldplat PLC (LON:GDP) has reported that its Kilimapesa gold mine is now operating profitably with a processing plant upgrade also now in the commissioning stage.
A throughput of 120 tonnes per day of ore during May was on target, it said, as stockpiled fine material and a spare crusher were utilised while the new crusher and leach tanks were installed.
A decision on the next stage on Kilmapesa’s expansion will be taken once consistent planned production and profitability have been achieved but a second mill will be installed while the mine will also switch to cheaper grid power.
Elsewhere, Ortac Resources Ltd (LON:OTC) received confirmation from the Slovakia Main Mining Bureau that its permit for the Sturec gold project will be re-issued.