PERTH (miningweekly.com) – An independent expert has more than doubled the value attached to gold developer Bullabulling Gold’s shares, when compared with a takeover offer made by fellow-listed Norton Gold Fields.

In an April takeover offer, Norton Gold Fields offered Bullabulling shareholders 7c a share in cash for each share held. The offer represented a 30% premium to the company’s share price on April 17, and a 32% premium to the three-month volume-weighted average price.

However, Bullabulling told shareholders on Wednesday that an independent expert had valued the company’s shares at between 11c and 16c a share, with a preferred value of 14c a share.

Bullabulling has maintained that shareholders reject Norton’s takeover offer, reiterating that it did not fairly reflect the value of the company’s namesake project, in Western Australia.

“Accepting the opportunistic offer will remove your exposure to any potential increase in value that the Bullabulling gold project offers,” the company’s directors warned shareholders.

Norton CEO Dianmin Chen has previously questioned Bullabulling’s ability to develop its namesake project, saying it would present significant funding challenges, which a small company such as Bullabulling would have ongoing difficulties managing. The project is expected to cost about A$300-million to bring to production.

Bullabulling was currently undertaking a definitive feasibility study (DFS) of the gold project, which was scheduled for completion in the first quarter of 2015.

The independent expert said that the current market price of Bullabulling’s shares did not reflect the results of the DFS, as these were yet to be released. If the DFS findings were favourable, however, and demonstrated the economic viability of an initial gold reserve, it could be expected that the value of both Bullabulling and its project would increase.

However, the independent expert conceded that additional funding would be required to complete the DFS, as well as significant capital expenditure to construct the project, if the DFS proved positive.

The expert pointed out, however, that if the Bullabulling project was viable, the gold company would have an increased ability to source the required funding to develop Bullabulling.

A previously completed prefeasibility study determined that Bullabulling could produce some 1.95-million ounces over 10.5 years.

Meanwhile, Norton Gold Fields has turned to the Australian Takeovers Panel, claiming that Bullabulling had omitted to inform its shareholders on material information relating to the takeover offer.

The gold miner also claimed that Bullabulling had made certain statements that had the potential to mislead shareholders, including that 41.8% of shareholders had informed the company that they would not accept the offer, the company’s near-term developments over the next 9 to 12 months, and the possibility of an increased offer from Norton.

Norton requested the Takeovers Panel to order Bullabulling to send a new notice of annual general meeting to shareholders, which clarified the disclosure deficiencies.