PERTH (miningweekly.com) – The shareholders of takeover target Orbis Gold have backed the company’s plan to raise A$20-million through a nonrenounceable rights issue, priced at 60c a share.
The rights issue was a point of contention in the 65c-a-share takeover offer that Canadian firm Semafo launched in October this year.
Orbis has previously rejected Semafo’s offer, saying it undervalued the company, and instead launched a search for an alternative bidder.
“By supporting the proposed rights issue, shareholders have voted overwhelmingly in favour of allowing Orbis Gold to pursue all available options to maximise value, including the possibility of a material improved offer to sell the company,” said Orbis chairperson John Bovard.
“The results of the annual general meeting further validate the board’s rejection of Semafo’s current offer and view on the company’s fundamental value.”
While the approval to proceed with the rights issue has now been obtained, the timing for the launch of the rights issue was yet to be determined and would be subject to market conditions, working capital requirements and consideration of other financing alternatives and potential corporate transactions.
The proceeds from the rights issue would be used to advance the flagship Natougou gold project, in Burkina Faso, towards a positive construction decision, and to progress key priority exploration and appraisal targets, as well as for working capital.