London, England — MININGREVIEW.COM — 28 July 2009 – Moto Goldmines Limited “’ a gold exploration and development company listed on the Toronto Stock Exchange and the AIM “’ has backed a takeover offer by African miners Randgold Resources Limited and AngloGold Ashanti Limited, saying it is superior to a competing offer.
Moto “’ which owns a project in the mineral-rich Democratic Republic of Congo (DRC) “’ said the Randgold/AngloGold offer worth US$502 million (R4 billion) was better than one from Red Back Mining announced on 1 June.
“Randgold’s cash-and-shares offer was financially superior to the all-share offer from Red Back, but Red Back had until 4 August to amend its offer,” Moto added.
Randgold has said it would offer 0.7061 of one of its London shares or US$4.60 in cash for each Moto share, with the total cash payment capped at US$ 244 million (R1.95 billion). It pointed out in a separate statement that on 24 July its offer had valued each Moto share at US$4.60, while Red Back’s offer had valued Moto shares at only US$4.15.
Randgold also said it had support for its offer from shareholders representing 36% of Moto’s total shares, as well as support from the government of the DRC.
Reuters reports that the deal would boost growth prospects for Randgold, as it extended its reach from West Africa into the DRC, where many rivals have been wary of entering due to an unstable political situation and continued unrest in the east.
Randgold has experience in risky countries “’ it is currently developing the Tongon mine in Ivory Coast, which is still recovering from a bitter civil war.
South Africa’s AngloGold “’ the world’s third-biggest gold producer “’ will finance the cash portion of the offer as partial payment for a 50% interest in Moto. Randgold and AngloGold are already partners at the Morila gold mine in Mali.
Randgold would be the operator of the Moto project. In March, a feasibility study estimated that the project contained 5.5 million ounces of probable mineral reserves.