PERTH (miningweekly.com) – Western Australia-based Moly Mines is “assessing its options” after the ASX determined that the company will not be allowed to relist should it proceed with the proposed acquisition of Gulf Alumina.

“Moly is extremely frustrated and disappointed with this decision, and in particular the impact it will have on all of Moly’s shareholders,” the company said in a statement.

The ASX this week advised the company that it will exercise its discretion and refuse Moly’s application for readmission to the ASX, questioning the structure and ownership of Moly’s largest shareholder, the Hanlong Group.

Hanlong founder Liu Han was found guilty of a number of offences in China, including murder and arms smuggling, and was executed earlier this year.

Moly said in a statement to shareholders that the ASX had failed to raise concerns at any stage during Hanlong’s seven-year shareholding in Moly, and had also remained mute on the issues when it was consulted in relation to the structure of the Gulf Alumina transaction and Moly’s potential relisting prior to the announcement of the transaction.

“At the time, the ASX expressed the view that it could see no reason why Moly should not proceed with an application for reinstatement to the ASX. Although this was not a binding decision of ASX, Moly was led to believe that there were no fundamental obstacles to reinstatement. As a result, Moly pursued the opportunity rigorously and incurred significant costs in progressing the transaction,” the company said.

Moly recently increased its takeover offer for target Gulf Alumina from 46c in cash and 1.4 options for each Gulf share to either an all-cash consideration of 63c for each of the Gulf shares held, or 46c cash and 1.14 Moly shares for each Gulf share held, valuing Gulf shares at 63c each.

The bid is aimed at rivalling Metro Mining, which holds a 39% stake in Gulf, which is offering Gulf shareholders a choice of 60c in cash a share, or a cash and shares alternative of 50c in cash and one metro share for each Gulf share held.

Metro on Tuesday pointed out that the Moly offer for Gulf was conditional upon the ASX reinstating the quotation of Moly shares.

The Gulf board has previously unanimously recommended that shareholders accept Metro’s offer, in the absence of a superior proposal.