consmin confirms takeover approach

http://www.theage.com.au/news/business/consmin-confirms-takeover-approach/2006/10/18/1160850997876.html



ConsMin confirms takeover approach
Jamie Freed, Sydney
October 19, 2006

CONSOLIDATED Minerals became the latest miner to reveal it has received a takeover approach, in response to a query from the stock exchange.

The West Australian manganese and nickel miner, with a market value of about $550 million, said yesterday a 30 per cent share price rise in the past week could be due in part to a preliminary approach from a suitor.

"We have received an approach from a third party to enter into discussions on a confidential basis regarding a possible transaction," ConsMin said. "However, no discussions of substance have taken place."

ConsMin shares rocketed another 11.5 per cent, or 25¢, to close at $2.43 yesterday.

There had been speculation earlier this week that fellow Kambalda nickel miner Independence Group was eyeing ConsMin.

But Independence managing director Christopher Bonwick yesterday told The Age he could "completely, utterly deny" his company had proposed a merger.

"We've basically been on a roadshow the last couple of weeks in London, Hong Kong and the eastern states, and we were saying there, we want to grow through our current asset base," Mr Bonwick said.

He would not comment on whether Independence had also been approached by possible suitors, but said: "I think quite a few companies see us as a good bride."

ConsMin's new management team, led by managing director Rod Baxter, has also been doing presentations in Australia and Britain, outlining the company's growth strategy and emphasising its status as an emerging nickel producer.

Wilson HTM analyst Andrew Pedler said the stock had been oversold due to the weak condition of the manganese market, which looked to be improving.

Additionally, the nickel price has risen 24 per cent in the last month, which may have enhanced the company's appeal to investors.