Mercantile lodges bidder statement for Bauxite takeover

Mercantile Investment which has proposed a takeover bid for Bauxite Resources so far has only 3.1 per cent of the company’s shares, a bidder statement lodged today confirmed. The company wants to acquire controlling stakes of the exploration firm with an off-market 9c-a-share cash offer for half of all the shares it does not own yet.

If all shareholders sold their parts, Mercantile would successfully acquire a controlling stake of 53.1 per cent.

In an earlier statement, Mercantile told to BAU shareholders, “Bauxite … has never found anything remotely viable and has chalked up losses of $48 million in the process.” To this Bauxite Chairman Robert Nash retaliated saying the statement made was “misleading.”

Mercantile’s offer made via a subsidiary is an 11 per cent increase on Bauxite’s 8.1c share price the day it made the offer. The company is valued at $19.3 million by the deal.

“I think they’re valuing them at nothing,” BAU chief executive Sam Middlemas said. “We’re actually having some valuations done now.”

According to Mr Middlemas, all major shareholders have backed the board as well as the company’s current strategy. A report is being made by an independent expert. It should be out within three weeks.