petra capital bullabulling worth 20c per share

Bullabulling says Norton takeover offer undervalues gold miner

BRETT COLE
MAY 01, 2014 9:00AM

Bullabulling Gold’s managing director Brett Lambert says Norton Gold’s 7 cents a share unsolicited takeover offer for its fellow Western Australian gold miner is 13 cents less than what the company is worth.

Stockbrokers Petra Capital values Bullabulling at 20 cents a share, a valuation Mr Lambert says is a “reasonable assessment” of Bullabulling’s estimated 3.75 million ounces of gold that lie outside Kalgoorlie.

“Norton have chosen their timing well as many gold companies are undervalued compared to their resources,” Mr Lambert told Data Room in an interview. “We think there is potential for people to gain a larger value in our company.”

Gold’s spot price has fallen 13 per cent in the last 12 months to $US1291.26 an ounce, according to Bloomberg data.

Yesterday, Bullabulling shares closed at 7.5 cents, giving the Perth-based company

a market value of $25.8 million. Norton’s takeover offer values the company at $24m while Petra Capital analysts value Bullabulling at $68.8m.

Norton Gold’s market value is $93.2m. The Perth-based company is a unit of China’s biggest gold producer Zijin Holding Group, which has an 82 per cent stake in Norton, according to Bloomberg data.

Norton Gold chief executive Dianmin Chen did not return calls seeking comment.

Bullabulling says 42 per cent of its shareholders have already rejected unsolicited Norton’s takeover offer. Darren Martin, executive director of Gresham, the investment bank hired by Mr Lambert to repel Norton’s takeover bid, declined to comment.

(Reporting by [email protected])

http://www.theaustralian.com.au/business/latest/bullabulling-says-norton-takeover-offer-undervalues-gold-miner/story-e6frg90f-1226901701346