Friday, August 09 14:24:45
Irish tungsten mine developer Ormonde today said it has received an unsolicited bid approach from Canadian group, Almonty, which it has rejected.
The Canadian firm has sought backing from the Ormonde board for a bid on the basis of one Almonty share for every 12.2 Ormonde shares. Those terms value Ormonde's shares at around 5.7p each, based on an Almonty share price of C$1.10.
The Ormonde board regards the terms as anything but the full Monty, and described the approach as "speculative, opportunistic and lacking in both strategic and economic merit for Ormonde shareholders.
The directors were unanimous in their decision to reject the approach.
"The key focus for Ormonde at this time is on making significant progress towards the development of its flagship tungsten project at Barruecopardo in Spain," said Ormonde's chairman, Mike Donoghue.
"Ormonde is not surprised that Almonty recognises the attractions of Barruecopardo. However, Ormonde's board sees no merit for Ormonde shareholders exchanging shares in Ormonde for shares in Almonty at a value which the board believes significantly undervalues Ormonde. The proposal would result in a significant dilution of Ormonde shareholders' ownership of Barruecopardo, whilst not providing funds required to develop the Barruecopardo Project," Donoghue claimed.
Ormonde shareholders have been advised by the board to take no action with respect to the approach from Almonty.