JOHANNESBURG (miningweekly.com) – Diversified mining firm Metals X has increased its offer for the Meekatharra gold assets, in Western Australia, to $10-million, after a last-minute competing offer was tabled at a GMK Exploration creditors meeting this week.

The Meekatharra assets are a key piece in the puzzle to bring Metals X’s Central Murchison gold project to fruition and MD Peter Cook on Friday described the deal as “astounding value”, despite the higher acquisition price.

“The purchase price remains astounding value when compared with the $120-million in capital expenditure we would require to build a new plant for our own ores,” he said.

Metals X increased its offer at the creditors meeting of GMK Exploration – the subsidiary of Reed Resources that owns the Meekatharra gold project – to A$9.4-million in cash and 24-million shares in Reed. This is an increase from the A$7.7-million that Metals X initially offered, which was made up of A$7.1-million in cash and 24-million shares in Reed.

Metals X increased its offer after administrator Ferrier Hodgson revealed a “five-minutes-before-midnight” offer at the meeting, advising the company that the competing offer was genuine and that the unnamed party was “well-funded and financially capable of completion”.

“We were extremely surprised that a conditional offer from an undisclosed party was put forward at the last minute to potentially scuttle a fully funded, disclosed and agreed purchase by Metals X. The offer only materialised after announcement to the ASX of the agreement Metals X reached with the administrator. Metals X undertook thorough due diligence before entering into the purchase process with the administrators and finds it scurrilous and unconscionable that an unnamed party decided to take advantage of this work at such a late stage,” said Cook.

However, he added that Metals X was pleased to have won the support of the creditors and that it had a clear path to completion and development of its combined Murchison region gold asset.

The acquisition adds 3.5-million ounces to its existing five-million ounces of total mineral resource at the Central Murchison gold project. When combined, the merged projects would have a total mineral resource of 8.5-million ounces, a total ore reserve of 1.89-million ounces, a 2.5-million-ton-a-year process plant, a 200-person accommodation village and substantial infrastructure.