Territory races the ConsMin clock
Kevin Andrusiak
July 13, 2007
TERRITORY Resources chairman Michael Kiernan has again demanded that Consolidated Minerals delay a vote on a Pallinghurst Resources-led bid for the carbon steels miner as he once more accused the ConsMin board of a dirty tricks campaign.
With only hours to go before Territory's bankers and legal hands are shut out of access to ConsMin's accounts as part of a limited due diligence period, Mr Kiernan has set Monday as the deadline for Territory to table a formal offer - expected to value ConsMin around $730 million.
However, ConsMin shareholders are set to vote on Thursday on Pallinghurst's share-and-scrip offer, which has been actively endorsed by the ConsMin board and values the Perth-based miner at around $665 million.
Pallinghurst, which is chaired by former BHP Billiton boss Brian Gilbertson, wants 60 per cent of the company, with current shareholders to retain the rest.
The company would then be renamed NewCSM and have other mining assets rolled into it.
The Pallinghurst deal has failed to gain much traction with local shareholders, who have rallied against the deal.
The July 19 vote would give shareholders just three days to weigh up Territory's proposal, should an offer be forthcoming on Monday. "I encourage you to contact the ConsMin board and demand that the Pallinghurst scheme meeting be delayed so that you can have the opportunity to assess which proposal is superior," Mr Kiernan wrote in a letter to ConsMin shareholders.
He lashed out at the ConsMin board for what he called a deliberate delaying tactic in the due diligence phase by not releasing ConsMin's unaudited management accounts.
Mr Kiernan, who headed ConsMin for eight years before he was ousted by institutions and powerful board factions, said he expected the accounts to be available just hours before due diligence was scheduled to close.
"I'm pleased to say that so far we have found no unexploded bombs in the ConsMin accounts or legal standing," he said.
"But we wait with bated breath for the new accounts which I believed were supposed to be released today (Thursday).
"It all just adds to the normal demeanour of the board trying to frustrate us. It's an absolute lay-down misere that they are not acting in the best interests of shareholders."
Mr Kiernan also signalled that Territory would maintain the cash component of its indicative offer at $2.00 a ConsMin share - which also comes with one Territory share - if it posts a formal offer, as expected, on Monday.
But he added that the alternative scrip component of three Territory shares for every ConsMin share owned might vary.
A ConsMin spokesman said the unaudited net profit after tax accounts had not been scheduled for release until today and were "within Territory's due diligence period".
He added that because there was only one firm proposal on the table, any call for a delay from Territory could only be considered if another bid was lodged.
"Should an offer be presented to ConsMin by Territory, the directors will consider it and act in the best interest of shareholders," he said.
TFE
territory iron limited
