Inmet sweetens bid for gold miner Petaquilla by 25%
Canadian gold miner Petaquilla Minerals Ltd. (TSX:PTQ) confirmed late Thursday it is studying an upgraded and final takeover offer by Inmet Mining Corp. (TSX:IMN), which is now offering about 25% more than $112-million it previously proposed.
Inmet said the new offer, which expires just before midnight on Nov. 5, represented a 71% premium to the closing price of Petaquilla shares on September 5, before Inmet first announced its offer.
The company’s CEO, Jochen Tilk, added Inmet does not need Petaquilla's agreement to develop its 80%-owned Cobre Panama copper and gold project.
“Minera Panama has received all required permits to commence construction, and has been under full construction since May of this year. Should Petaquilla's board and management move forward with the previously announced $210-million high-yield debt offering, Inmet is prepared to let the final offer expire," he said.
Tilk noted that the British Columbia Securities Commission had confirmed a hearing date of October 30 at 10:00 PT to consider Inmet's request for the immediate cease trading of Petaquilla's shareholders' rights plan or ‘poison pill’.
Petaquilla rejected Inmet's initial bid in early October, arguing it failed to provide adequate value to shareholders.
"In light of the appreciation in Inmet's share price in recent weeks, we are making the final offer to normalize the growing gap between the cash and share consideration alternatives under the offer," said Inmet's president and CEO Jochen Tilk.
"There will be no further adjustment to Inmet's offer."
Last month, the Department of Mineral Resources of Panama rejected a petition filed by Minera Panama, S.A., a subsidiary of Inmet Mining Corporation, in respect to the belt known as the San Juan concession. The area is comprised of 11,145 hectares, which Petaquilla Minerals has the rights to explore as granted by the Department of Mineral Resources in 2007.
Inmet received in August a whopping $1 billion from fellow Canadian Franco-Nevada (TSX & NYSE: FNV) to support the development costs of Inmet's massive Cobre Panama copper project, the country's largest-ever mine development. In exchange Franco-Nevada will get a future steam of precious metals.
Petaquilla's Molejon project neighbours Inmet's $6.2 billion Cobre Panama copper-gold porphyry project, the first large-scale mine in the Latin American country’s history. Cobre contains more than 32 billion pounds of copper, according to Inmet’s estimations, almost nine million ounces of gold and 168 million ounces of silver in measured and indicated resources.
The mine is expected to ship its first consignment of concentrate during the first quarter of 2016, and the life-of-mine is expected to exceed 31 years.