Gold Valley Iron Ore has launched an on-market takeover bid to acquire CZR Resources, rivalling the bid Fenix Resources made in late February.
The unsolicited, confidential, non-binding, indicative and conditional takeover proposal involves Gold Valley acquiring all CZR shares for $0.31 per CZR share.
The Gold Valley proposal is subject to two key conditions. The first is the proposed acquisition being backed by Gold Valley’s funders, including an unnamed large global commodities trader based in Switzerland.
The second condition is the bid implementation agreement between Fenix and CZR being terminated and CZR releasing Gold Valley from its standstill obligations under the confidentiality deed between the two companies.
Gold Valley has offered to pay CZR $2.5 million if it fails to make a binding offer based on the terms of its proposal within five business days, provided the standstill obligations are released and Fenix hasn’t received acceptances under its proposed takeover bid for more than 50 per cent of CZR shares.
CZR said Gold Valley’s proposal is an expression of interest only and does not “constitute a superior proposal” to Fenix’s.
“The non-binding nature of the Gold Valley proposal means there is no certainty that Gold Valley will proceed with a takeover bid on the terms proposed … Gold Valley has also reserved the right to change the structure of the transaction and impose conditions to the transaction,” CZR said.
CZR continues to unanimously recommend that all CZR shareholders accept Fenix’s offer, which would see CZR shareholders receive 0.98 Fenix shares for every CZR share at an implied value of $0.30.
Fenix must obtain a 75 per cent interest in CZR shares by March 21 7.00pm AEDT. If it is successful, CZR’s assets will expand its portfolio to include interests in projects with mineral resources of approximately 140 million tonnes of iron ore.
Fenix has already received acceptances from CZR shareholders for 10 per cent of all CZR shares.
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