Coal miner CIC Energy mulls $450-mn takeover offer from Indian firm

CIC Energy Corporation, a junior coal exploration company yesterday said that it has received a takeover bid from an unidentified Indian conglomerate for an indicative price of $8.50 a share that values the company at $450 million, almost triple its market value.

British Virgin Islands-based CIC that is listed on the Toronto and Botswana stock exchanges, did not name the Indian suitor but said that the Indian conglomerate has interests in coal mining and power generation.

The unidentified Indian company has offered an indicative price of $8.50 per share, of which up to $3.50 will be payable upon reaching certain project milestones.

''The proposal provides for an indicative price of $8.50 per share, of which up to $3.50 will be payable upon fulfillment of certain project milestones. Along with the other terms and conditions of the proposal, the price will be subject to negotiation and may change,'' said CIC in a statement.

It also added that there would be no assurance that the company will reach an agreement with the potential purchaser or that the potential purchaser will proceed with the deal.

CIC stock was trading at $3.25 yesterday on the Toronto Stock Exchange, which values the company at around C$171 million. The Indian company is offering $450 million or nearly three times the market value of CIC.

CIC is a junior coal miner that explores and develops coal properties in Botswana, Africa. Its flagship property is the A grade steam Mmamabula Coal Field. It is also in the process of developing the Mmamabula power complex and upgrading the rail and port infrastructure.