Moly Mines, one of the most talked about companies on the ASX (for all the wrong reasons though) is reportedly fighting a US$53 million+ battle with Metro Mining for the acquisition of Gulf Alumina's Queensland bauxite operations ownership. Every stakeholder linked to the matter is known to be waiting anxiously for the Gulf Alumina board to come up with its decision on the same; The board is currently reviewing the bid offers made by both the companies.
Last week, Moly Mines submitted a revised bid whereby it offered 63c a share in cash or 46c cash plus 1.14 shares in Moly. But the cash consideration is limited to $42 million, which means the cash component would drop to just 46c a share if all Gulf Alumina shareholders accepted the all-cash bid.
Moly Mines, in its earlier releases, said that it wanted to buy Gulf Alumina in order to end a two-and-a-half year suspension on the ASX. It was suspended from trading on the bourse as it could not show any significant project under its ownership at that time.
However, the company's present offer is subject to approval by the Foreign Investment Review Board and the ASX..jpg)
Metro Mining, on the other side, has made a 60c cash or 61c in cash and shares-for-share offer for Gulf Alumina's Skardon River bauxite project. The miner aims to leverage upon the project's strategic location beside its own Bauxite Hills project.
The renewed offer made by Moly Mines stands superior, value-wise, to that made by Metro Mining. This has stoked fears within the company that the Gulf board may take decision in favour of Moly Mines. The board taking time to announce its decision is making Metro management all the more tensed if not sceptical.
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Moly Mines is majority owned by China’s highly controversial Sichuan Hanlong Group. Politicians from Queensland have already approached the Foreign Investment Review Board and the ASX more than once with the plea to block Moly from making the purchase bid. However, the company is known to be putting in a lot of efforts to close the deal by December end this year.
Metro Mining already owns a 39.3 per cent stake in Gulf Alumina.
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