Discovery Metals set to announce $830m takeover offer PUBLISHED: 0 hour 17 MINUTES AGO | UPDATE: 0 hour 4 MINUTES AGO
Discovery Metals is set to announce a $830 million takeover offer from China’s Cathay Fortune Capital and China-Africa Development Fund.
The Chinese bidders, advised by Citigroup and King & Wood Mallesons, have offered $1.70 a share for all Discovery Metals shares.
They approached Discovery Metals chairman Gordon Galt on September 21 with a non-binding proposal at $1.70 a share. Discovery Metals shares have since gained 13.9 per cent to close at $1.46 yesterday.
The offer was pitched at a 50 per cent premium to the 30-day volume weighted average price leading into the September 21 meeting. It was also a 42 per cent premium to the price of shares sold to institutions at a placement on August 8.
The all-cash offer was not subject to financing, which had already been approved by China Development Bank.
The bidders have also received approval from China’s National Development and Reform Commission.
It is understood Discovery Metals is advised by UBS. It went into a trading halt on Thursday morning.
Cathay Fortune Capital is a Chinese private equity fund, while China-Africa Development fund is a Chinese fund which invests in African projects.
Discovery Metals is Australian-based but its main asset is the Boseto copper project in Botswana.
TGS Price at posting:
36.0¢ Sentiment: Buy Disclosure: Held
