HomeGoldOrbis Gold rejects A$162m Canadian miner SEMAFO bid

Orbis Gold rejects A$162m Canadian miner SEMAFO bid

ASX-listed West African-focused gold producer Orbis Gold has rejected an unsolicited acquisition proposal from TSX-listed Canadian miner SEMAFO valued between A$154.94 million and A$162.44 million.

SEMAFO offered to acquire 100% of Orbis Gold’s issued ordinary shares for cash consideration of between A$0.62 to A$0.65 per share.

“SEMAFO is firmly of the view that its all-cash proposal represents a superior outcome for Orbis shareholders than proceeding with the conditional greenstone placement,” the company said in a statement.

There are a number of risks inherent in developing a greenfield mining project in West Africa. “SEMAFO’s cash Proposal would offer Orbis shareholders the opportunity to avoid these risks, while realising an immediate and substantial cash premium for their shareholding. SEMAFO’s proposal represents a substantial premium,” the company said.

Nevertheless, Orbis Gold responded in a statement that “There are no assurances that this approach will lead to an offer for the company or its assets being made, either now or in the future. The receipt of the proposal follows a recent unsolicited approach by SEMAFO regarding a potential transaction.

“Following careful review and analysis of the proposal, the Orbis Gold Board has unanimously determined the proposal significantly undervalues Orbis Gold, both in terms of its existing assets, and the potential value the company expects to deliver to its shareholders in the near future.”

Orbis Gold is currently updating its scoping study for the Natougou Project following the expanded mineral resource estimate announced in August 2014. Results of this study are expected to be announced in the following days and may have a material impact on the valuation of the company.

“SEMAFO’s proposal has been made prematurely ahead of the company’s imminent release of this update and with knowledge that the update was imminent. Orbis Gold is committed to advancing its flagship Natougou Gold Project to production and expanding its high‐grade mineral resource inventory and future production capacity through ongoing exploration and development,” Orbis Gold concluded.

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