PERTH (miningweekly.com) – Embattled copper miner Aditya Birla on Friday urged shareholders not to take any action after receiving an unsolicited off-market takeover offer from fellow-listed Metals X.

Metals X has offered one of its own shares for every five Aditya Birla shares held, valuing the company’s shares at 24.7c each.

The offer price was a 60.6% premium based on the two companies’ closing prices on October 14, and a 46.9% premium based on the one-month volume weighted average price of both companies’ shares.

“Aditya Birla is an underperforming company and its shareholders have seen substantial loss of wealth over the last few years,” Metals X CEO and MD Peter Cook said this week.

“Nifty is an underperforming asset and continues to be a challenging operation, which, with appropriate stewardship, is capable of being a good mine. Metals X believes its underground mining experience, technical capability, financial capacity and experience in operating Western Australian mines make it almost uniquely placed to take on the Nifty challenge.”

Cook said the underperforming mine was an ideal opportunity for Metals X, located in the right region, the right commodity and right time in the commodity cycle, providing a logical next step in Metals X’s growth profile.

The mine would also allow Metals X to diversify into copper, in addition to its existing gold, tin and nickel mines.

The offer for Aditya Birla would be subject to a number of conditions, including a 90% acceptance condition.

Metals X noted that Aditya Birla’s controlling shareholder Hindalco Industries, which owns a 51% stake in the company, would have to accept the offer in order for the remaining shareholders to also accept the offer.

Aditya Birla on Friday told shareholders not to take any action around the proposed takeover offer, until the board had had time to make a recommendation.

The mining rate at Nifty was impacted by a fatality in May, which resulted in operations being suspended. For the full year to March, Nifty was now estimated to produce between 24 000 t and 27 000 t of copper, instead of the previous estimate of between 27 000 t and 29 000 t of copper.

The copper miner in September also sold its Mt Gordon operation, in Queensland, in a A$15-million transaction with Lighthouse Mineral Holdings.