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Building|PROJECT|Refinery|Resources
Building|PROJECT|Refinery|Resources
building|project|refinery|resources

Kidman/Wesfarmers talks going for 'some time'

9th May 2019

By: Esmarie Iannucci

Creamer Media Senior Deputy Editor: Australasia

     

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PERTH (miningweekly.com) – The chairperson of takeover target Kidman Resources, John Pizzey, on Thursday revealed to shareholders that the company had been in discussions with suitor Wesfarmers "for some time" regarding a possible takeover offer.

Wesfarmers earlier this month launched a non-binding and conditional A$776-million cash offer for Kidman, offering shareholders A$1.90 a share in cash for their interest in the company.

Wesfarmers has to date gained an interest in Kidman of more than 17%.

Pizzey told shareholders at Kidman’s annual general meeting that the company sought comment and eventually support from its major shareholders, who in conjunction with the board and management controlled some 17% of the company.

“When Wesfarmers presented us with a written proposal, the board evaluated it carefully and concluded that it is in the best interest of shareholders to engage further with Wesfarmers on an exclusive basis.

“There is no doubt that the Mt Holland lithium project, being developed by the Covelant lithium joint venture has great potential. There is also no doubt that playing in the resources sector, especially when the value is liberated by developing a mine, building a concentrator and then a refinery to develop a consumable product, is a cash consuming task.

“Kidman has always been willing to go down the path of an integrated project, and the board and management are excited by this idea. But in the long run, the company does not exist for the board or management, so when in the negotiations a proposal of this value was reached, we supported it and intend to put it to you, the shareholders,” Pizzey said.

Wesfarmers has until May 29 to complete its due diligence on Kidman, with the companies working on binding transaction documentation.

Edited by Creamer Media Reporter

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