suhr /watson grab at crown, page-5

Hi All,
Here is the Age article in full.
Lynas faces shareholder bid for asset
Philip Wen
May 16, 2011
THE contentious attempted sale by Lynas Corporation of a rich rare earth and rare metals deposit to a related party has taken a new turn, with two prominent dissident shareholders preparing an audacious bid to pinch the prized asset from under the nose of the miner's chief executive, Nick Curtis.

Melbourne-based software millionaire Mark Suhr and the chairman of online recruitment website Seek, Bob Watson, are finalizing a formal bid for the Crown and Swan deposit this week, capitalizing on the dramatic collapse of the rare earth miner's proposed deal with related party Forge Resources.
The lawyer acting for the two businessmen, Chris Curran, of Turner Freeman, said Lynas had backed itself into a corner by readily accepting Forge's offer. He said the board would have trouble justifying a rejection of a similar or improved offer so soon after declaring the asset non-core and ready for sale.

"We think Lynas have shot themselves in the foot there," Mr. Curran said. "If we put in a similar bid to the one before, they would be in a very awkward position to not approve it."
The drama is likely to further aggravate Lynas's major institutional shareholders, who had made clear they wanted no distractions from the rare earth miner's core promise of bringing its prized Mt Weld rare earths deposit into production

The planned $20.7 million sale of the Crown polymetallic deposit to Forge had attracted significant shareholder criticism over the asset's valuation, conflict-of-interest concerns, and perceived inadequate disclosure of the financial benefit Mr Curtis stood to receive.
A 2007 Lynas investor presentation boasted of the Crown ore body's ''over $50 billion metal content'' and ''positive project value''. Lynas had continued to promote the deposit to investors until last year, before deciding the asset was ''non-core''.
Mr Curtis would have boosted his stake in Forge to close to 40 per cent if the deal had proceeded. He owns less than 1 per cent of Lynas.
With the corporate regulator's attention roused, Lynas was forced to delay its shareholder vote, and was in the process of revising its disclosure documents before the deal was pulled.
Lynas said it decided to abandon the deal based on the feedback from its predominantly offshore major institutional shareholders. It is also understood institutional shareholders were concerned Mr Curtis would have been distracted with his involvement in Forge if the deal proceeded.

With no related-party concerns, the Suhr-Watson bid will not be required to be approved by shareholders. Mr Curran said the bid was "well advanced" and that a Lynas independent director had been "responsive" after being sounded out.
The two businessmen had been instrumental in generating shareholder momentum against the Forge deal. The deal has also triggered concerns over Mr Curtis's influence on the Lynas board, prompting a push for more independent directors on the board.

Lynas management is understood to be furious with Mr Suhr; with one source insistent Mr Suhr had a history of destroying shareholder value.

Read more: http://www.theage.com.au/business/lynas-faces-shareholder-bid-for-asset-20110515-1eo9b.html#ixzz1MSO14S7l

We will have to wait and see what is contained in Mark Suhr's offer to decide whether it is in the interests of ALL Lynas shareholders or not.



regards



jukieoz836