indophil welcomes proposed offer for tampakan

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Indophil Resources NL (ASX: IRN) has received an encouraging proposal from Alsons
Corporation (Alsons) which advises that it is making an offer with the support of Crosby
Capital to acquire all of Indophil’s interest (34.23%) in the world-class Tampakan copper
gold deposit (Alsons’ Proposal). The Alsons’ Proposal shows the strength of commitment
and determination of Indophil’s Philippines partner to acquire the Tampakan asset.
The Alsons’ Proposal is outlined in announcements from the Stanhill Consortium and
Alsons, both dated 11 September 2008. In summary, Alsons has entered into discussions
with Indophil regarding the potential acquisition of all of Indophil’s interest in Sagittarius
Mines Inc. (SMI)1, which would not trigger any third party pre-emptive rights, and assume
the intercompany loan entitlements owing to Indophil from SMI. Under the Alsons’ Proposal,
Indophil would remain listed on the ASX and retain all non-Tampakan assets, including
several promising exploration assets and significant cash reserves.
If the Alsons’ Proposal is completed, it will allow Indophil to realise the value in the
Tampakan Project for cash. The Alsons’ Proposal is to purchase Indophil’s interest in the
Tampakan Project at a price which values such interest at an equivalent value to the
Stanhill bid of A$1.28 per share. The material net cash balance that would ultimately reside
within Indophil, after transaction costs and applicable taxes, is expected to be returned to
shareholders in the most expeditious manner.
Indophil’s Chairman, Brian Phillips, said: “Throughout the proposed takeover of Indophil, the
Stanhill Consortium has acted in good faith towards Indophil, with true professionalism, and
carried through on its stated intentions. The Alsons’ Proposal, as supported by Crosby
Capital, demonstrates that it clearly recognises the fundamental value in the Tampakan
project.”
Stanhill’s announcement today states that its offer for Indophil will lapse on 22 September
2008, principally due to the sale of a 17.8% interest in Indophil by Lion Selection Limited
(Lion) to Xstrata Copper Queensland Ltd (Xstrata). The immediate consequence of Lion’s
actions has resulted in a loss of value for all Indophil shareholders. The Lion sale effectively
gave Xstrata a blocking stake to the Stanhill takeover offer, which required 90% shareholder
acceptances. By doing this, Lion has prevented Indophil shareholders from being able to
realise the recommended Stanhill offer of $1.28 cash per share and the additional value
from retaining 80% of the non-Tampakan exploration assets.
Lion’s sale to Xstrata was extraordinary as Lion received a price of only $1.17 per share,
10% below the total value under the Stanhill offer. It was also premature as it occurred
when Stanhill was receiving significant acceptances at an early stage of the offer period and
when Stanhill was legally unable to make its offer unconditional. Lion’s action has also
triggered a $5 million break fee payable by Indophil to Stanhill.
1
SMI holds the Columbio FTAA in which lies the Tampakan Project.
“Indophil is disappointed that the recommended Stanhill takeover offer will not proceed.
However, Indophil’s Managing Director and CEO, Richard Laufmann, is not part of the
Alsons’ Proposal and is being released from any constraints in representing Indophil due to
his previous involvement in the Stanhill Consortium. Richard is now able to drive the asset
sale process to maximise value for Indophil shareholders and the resulting cash distribution
to our shareholders,” Mr Phillips said.
Richard Laufmann said: “I am very pleased to recommence my full CEO role at Indophil,
unfettered by any conflict. Whilst the takeover of Indophil was the preference for our
shareholders, I am confident that the Alsons’ Proposal is a positive step forward for Indophil
and Alsons, supported by Crosby. It has the capacity to expeditiously complete this
transaction.”
Whilst there is no certainty that the discussions with Alsons will result in an agreement
being signed, Indophil will now move towards negotiating definitive documentation with
Alsons. It is anticipated that the transaction will be put to Indophil shareholders for approval
by way of ordinary resolution shortly thereafter.
Indophil is actively working towards procuring this outcome in the shortest possible
timeframe. Further details will be provided to shareholders as the process advances.
For further information, please contact:
Richard Laufmann
Chief Executive Officer / MD
Indophil Resources NL
T +61 (0)3 8620 5800
Craig Jensz
Executive Director
Gresham Advisory
Partners Limited
T +61 (0)3 9664 0372
M +61 (0)400 634 979
Gavan Collery
Manager Corporate Affairs
Indophil Resources NL
T +61 (0)3 8620 5803
M +61 (0)419 372 210
E [email protected]