Lemur slams Bushveld takeover, urges rejection
JOHANNESBURG (miningweekly.com) – ASX-listed Lemur Resources on Friday urged shareholders to reject an off-market takeover offer by Aim-listed Bushveld Minerals.
The Madagascar-focused group said that, in addition to being “neither fair, nor reasonable”, the potential transaction’s disadvantages outweighed the advantages.
In May, Lemur shareholders were offered three Bushveld shares for every five Lemur shares, valued at A$0.099 apiece – which Bushveld said was at a premium of 65.5% to Lemur's closing share price on the ASX of A$0.060 on May 10.
Lemur said that the preferred value of five Lemur shares is $0.760 and the preferred value of the offer consideration represented $0.609 for three Bushveld shares.
The deal would also result in shareholder dilution and reduced exposure to Lemur’s assets.
Further, Lemur questioned the Aim-listed company’s financial stability, noting that its ability to “continue as a going concern is uncertain”, with a cash position of £430 000 and that, without a successful capital raising of about £1.5-million, Bushveld’s intended projects and certain expenditure would need to be curtailed.
The ASX-listed firm was in a strong position, with $17.06-million in cash, and no debt, and “does not need Bushveld” to assist in bringing its projects to fruition.
Lemur concluded that the shares within Bushveld were also tightly held – with the top 4 of 130 shareholders holding 94% of the company – and trading in the shares may not be liquid.
Lemur said it was currently preparing its target statement in response to Bushveld’s offer and bidders statement.
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