Takeover moves towards iron ore explorer Polaris Metals NL are heating up, after an Asian company announced its intention to outbid an offer by an Australian company.
Polaris said it was considering the announcement from Lion-Asia Resources Pte Ltd to make an off-market all cash offer of 60 cents per share, which valued the company at $105.54 million.
The bid would trump a rival offer made in August by Australian mining services and contracting company Mineral Resources Ltd, Lion-Asia said in a statement.
The offer was lodged with the Australian Securities Exchange after the close of trade on Monday night, the day Polaris Metals had given as a deadline for its intention to accept the MRL offer.
Polaris holds iron ore tenements spanning more than 6000 square kilometres across the Pilbara and Southern Cross regions of Western Australia.
New bidder Lion-Asia is incorporated in Singapore, a 50-50 joint venture owned by Lion-Asiapac Ltd, and the chairman of Malaysia's Lion Group, Tan Sri William Cheng Heng Jem via his investment company.
Both joint venture partners are associated with Lion Diversified Holdings Berhad, which currently holds 25.4 per cent of the Australian company.
"Lion's cash offer for Polaris is compelling and represents a significant premium to the scrip bid made by Mineral Resources Ltd," said Cheng Heng Jem.
"I believe that the Lion offer represents outstanding value for Polaris shareholders and provides an excellent opportunity for shareholders to realise immediate and certain value from their investment in Polaris," he said.
Lion-Asia said its bid represented a 19 per cent premium to the implied value of a bid by Mineral Resources of 50.4 cents, and a 100 per cent premium to Polaris's closing share price on August 14.
In a statement on Tuesday, Polaris said the LAP offer would be conditional upon Foreign Investment Review Board approval and other conditions.
Mineral Resources on Tuesday declared it had 26.69 per cent of Polaris shares under its takeover offer, which is scheduled to close on October 26.
"The board of Polaris is currently assessing the LAP Offer with the assistance of its advisers and will make its formal recommendation in relation to the LAP Offer and the Minerals Resources offer as soon as practicable," Polaris managing director Ken Hellsten said.
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