PERTH (miningweekly.com) – Shares in Singapore-listed Blumont Group, which on Friday revealed that Australia-listed Cokal was the subject of its now-scrapped $124-million foreign takeover offer, continued to plummet on Monday.
The company was the second-biggest loser on the Singapore Stock Exchange (SGX) on Monday and had so far lost 82% of its value since revealing the name of its takeover target last week.
Blumont’s share price crashed by 56% on Friday, prompting the SGX to suspend share trading. When the suspension was lifted on Monday, the stock continued to slide to S$0.15 a share.
Cokal, which focuses on metallurgical projects in Indonesia and Tanzania, has requested that its share trading on the ASX remain suspended until October 8.
Blumont previously announced that it had reached an agreement on the commercial terms of a A$124-million takeover offer for a foreign-listed coal firm, without stating the name of the company. It would have paid for the acquisition by issuing about 72.2-million shares.
However, the significant decline in its share trading price had affected the commercial terms discussed with Cokal, and led to the companies scrapping the transaction, for the time being.
Blumont stated that negotiations with Cokal were continuing, as both companies continued to believe in the strategic merit underpinning the now cancelled transaction.
Blumont recently announced a $108-million investment in ASX-listed Discovery Metals, which owns the Boseto copper mine, in Botswana.
The head of Blumont's copper unit, Ines Scotland, was quoted on Monday saying that the price slump would not affect the company's deal with Discovery, adding that the decline in the share price had nothing to do with the fundamental value of Blumont's portfolio.