Kin Mining rejects offer from MHM Metals
JOHANNESBURG (miningweekly.com) – The owner of the Leonora gold project in Western Australia, Kin Mining, on Thursday confirmed that it had rejected a proposal to merge with fellow ASX-listed company MHM Metals.
With its eye on the Leonora project, MHM had made an indicative nonbinding proposal to Kin, which the target’s board had reviewed and concluded was “opportunistic”.
“The approach significantly undervalues the company at a time when the company’s current work programme is delivering additional value to shareholders. Consequently, the board unanimously decided to reject the proposal.”
Kin reported that it had been strongly advancing the Leonora project and that its new CEO, Don Harper, would take the project into production as “soon as practicable”.
On Wednesday, MHM Metals announced that it had acquired a 10% stake in Kin Mining, saying it had identified Leonora as an “attractive potential gold development” and that it believed it could add significant value to Leonora.
The Leonora project, comprising the Mertondale, Cardinia and Raeside areas in the Mt Margaret mineral field in the centre of the Eastern goldfields, could be brought into full scale production by the end of 2017.
A scoping study had shown that it could produce an estimated 315 600 oz of gold over a seven-year project life. It envisaged a standard truck-and-shovel configuration.
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