NORTON ANNOUNCES TAKEOVER BID
Written on the 22 April 2014
NORTON Gold Fields Limited (ASX:NGF) has announced plans to take over Perth-based Bullabulling Gold Limited, with a cash offer of seven cents per share.
The gold producer launched the off-market offer on April 17, providing Bullabulling shareholders with a premium of 30 per cent on the closing price of $0.054 per unit.CEO Dianmin Chen says the offer is generous, representing a 77 per cent premium to bonus shares issued to executives in 2013.
“Norton’s cash offer of seven cents per Bullabulling share represents a substantial premium to the prices at which Bullabulling shares have generally traded in the market over the past year and with the offer being subject to only minimal conditions, we believe it should be seen as highly attractive to Bullabulling shareholders.“We believe this is evidenced by the fact that shareholders representing 6.6 per cent of Bullabulling shares have already indicated their intention to accept the offer,” he says.
Chen says the proposed takeover will improve the growing company’s funding challenges.“By accepting the offer, Bullabulling shareholders will remove their exposure to these major financing risks and the likely continued dilution in the value of their shareholdings.”
NGF estimates that more than $300 million in capital is required to bring the Bullabulling Gold Project into production.The offer closes on June 2, subject to approval by the Foreign Investment Review Board and no adverse material changes or new commitments in Bullabulling.