Mercantile fails in its bid for Phosphate Australia
PERTH (miningweekly.com) – ASX-listed Phosphate Australia has successfully fended off a takeover offer from fellow-listed Mercantile Investment, telling shareholders on Wednesday that the company had now lodged a complaint with the Australian Securities and Investment Commission regarding Mercantile’s behaviour.
Phosphate Australia said that during the offer period, Mercantile sent "certain communications" to Phosphate Australia shareholders, which the company said were factually incorrect, potentially misleading and defamatory.
Mercantile at the start of May raised its offering price from 2c a share to 2.2c a share in cash, an offer which the directors of ASX-listed Phosphate Australia again rejected. The company’s shareholders followed suit.
Phosphate Australia told shareholders on Wednesday that following the failed bid, the company’s focus would be on a scoping study for its Highlands Plains phosphate project, in the Northern Territory, which had an inferred resource of 53-million tonnes.
“The directors intend to use our cash to finance a scoping study at the Highlands Plains phosphate project and to fund future acquisitions and exploration at existing projects,” said executive chairperson Jim Richards.
“This is what will generate value for shareholders who share our dream of building our company through mineral discoveries, development and astute deal-making.”
Richards said that the scoping study would take into consideration the nearby Century zinc mine, some 68 km east of the Highlands Plains deposit, as the project included mains power, a full beneficiation plant and uses a slurry pipeline to transport product to Port Karumba.
Hong Kong-listed MMG owns the zinc mine.
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