PanAust accepts sweetened $950-mn takeover bid from China’s GRAM

Australian mid-tier copper and gold miner PanAust has confirmed that the company has accepted the raised A$1.2-billion ($950 million) takeover bid from China's state-owned Guangdong Rising Assets Management (GRAM).

In an announcement to the Australian Securities Exchange (ASX) yesterday, PanAust said, ''The independent PanAust directors intend to accept the revised GRAM offer in respect of all the PanAust shares they own or control, in the absence of a superior proposal.''

The revised Chinese offer is 8 per cent higher than its previous bid. The Chinese firm has offered A$1.85 per share of PanAust against its unsolicited March offer of A$1.71 a share or A$1.1 billion, representing a 51-per cent premium to the last closing price of PanAust prior to GRAM's earlier offer.

It is also within the fair valuation range of A$1.84-2.04 for PanAust estimated by an independent expert, considering a 20-per cent surge in copper prices from their January lows.

PanAust had been seeking a raised offer since the release of the independent expert's report in its formal response to the unsolicited bid from GRAM.

The Chinese firm, which already owns 24.3-per cent of PanAust has now declared its revised offer to be best and final, subject to no competing proposal emerging.

PanAust chairman, Garry Hounsell, said, ''The unanimous recommendation to accept GRAM's revised offer has been made following careful consideration by the board of all options to maximise value for PanAust shareholders.''

''GRAM's revised offer enables our shareholders to realise a compelling premium for their shares and provides certain cash value,'' he further stated.

Brisbane-based PanAust is a copper and gold producer in Laos having further development opportunities in Laos, Papua New Guinea (PNG) and Chile.

The company's producing assets include Phu Kham copper-gold operation and Houayxai gold-silver operation, located in its prospective 2,600 sq.km area in Laos.

The miner holds an 80-per cent interest in PNG's Frieda River project, one of the largest known undeveloped copper-gold deposits in the world.

''The board has considered the long-term value potential of these assets,'' PanAust said further stating that ''GRAM is well-placed to support the long-term strategy of the company, including the development of the Frieda River Project in PNG.''

GRAM's latest bid is well below its indicative non-binding offer of A$2.30 a share last year which had valued the copper-gold miner at A$1.5 billion.