Metro Mining considers their offer for Gulf to be superior to Moly Mine's new offer

Metro Mining Limited has announced the presentation of a highly conditional proposal by Moly Mines Limited regarding acquisition of all the shares of Gulf Alumina Limited. The company said it is pinning hopes on the Gulf Board of Directors' decision on the new proposal who they learnt to be considering whether Moly's proposal, which remains conditional on FIRB and ASX approval and hence uncertain- matches or is superior to Metro's offer- a fully funded one, dated October 28, 2016.

Moly has been suspended from trading on ASX since 2014, and its holding company Sichuan Hanlong has had come under scanner multiple times due to its alleged involvement in controversies in Australia and China.

Now, all eyes are focused on the board of Gulf Alumina as it considers offers made by both the companies.


According to Metro's media release, the new proposal made by Moly consists of:

• An all cash option of US$0.63 for each Gulf share, subject to cash consideration payable not exceeding $42 million, which should all Gulf shareholders elect to receive will only provide cash of $0.46 for each Gulf share; or
• A cash and share option of $0.46 per Gulf share and 1.14 Moly shares, which based on Moly’s last share price of $0.069 before it has suspended from ASX trading in April 2014, will only provide implied value of $0.54 for each Gulf share.

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There are other factors which Metro thinks make Moly's offer to acquire Gulf's share questionable and inferior to their offer due to close on 5 December 2016. So, they are hopeful that the Gulf board would recommend their offer.