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Petaquilla Minerals Ltd. (TSX:PTQ) has rejected the latest takeover bid by Inmet Mining (TSX:IMN) presented Friday, The bid was 25% higher than the $112-million Inmet originally offered.
The Canadian gold producer said the new offer “continues to fail to provide adequate value for Petaquilla shares.”
“We continue to explore strategic alternatives to enhance the value of our company, including engaging in discussions with third parties regarding a potential transaction and proceeding with the ongoing marketing process for our previously announced high-yield note offering,” Petaquilla said in the statement issued Monday.
Inmet, which operates a gold mine adjacent to Petaquilla’s Molejon project in Panama, said last Wednesday it was increasing its bid to 0.0118 of a common share of Inmet and 0.001 of a cent for each Petaquilla share. Alternatively, it was offering up to 60 cents in cash or a combination of cash and shares.
“The increased offer consideration represents a substantial increase of approximately 25% over Inmet’s original offer,” it said.
Petaquilla rejected Inmet’s initial bid in early October, arguing it failed to provide adequate value to shareholders.
“In light of the appreciation in Inmet’s share price in recent weeks, we are making the final offer to normalize the growing gap between the cash and share consideration alternatives under the offer,” said Inmet’s president and CEO Jochen Tilk.
“There will be no further adjustment to Inmet’s offer.”
Last month, the Department of Mineral Resources of Panama rejected a petition filed by Minera Panama, S.A., a subsidiary of Inmet Mining Corporation, in respect to the belt known as the San Juan concession. The area is comprised of 11,145 hectares, which Petaquilla Minerals has the rights to explore as granted by the Department of Mineral Resources in 2007.
Inmet received in August a whopping $1 billion from fellow Canadian Franco-Nevada (TSX & NYSE: FNV) to support the development costs of Inmet’s massive Cobre Panama copper project, the country’s largest-ever mine development. In exchange Franco-Nevada will get a future steam of precious metals.
Petaquilla’s Molejon project neighbours Inmet’s $6.2 billion Cobre Panama copper-gold porphyry project, the first large-scale mine in the Latin American country’s history. Cobre contains more than 32 billion pounds of copper, according to Inmet’s estimations, almost nine million ounces of gold and 168 million ounces of silver in measured and indicated resources.
The mine is expected to ship its first consignment of concentrate during the first quarter of 2016, and the life-of-mine is expected to exceed 31 years.
Image of a sad woman by Nationaal Archief
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