Chinese Bid for PanAust Spurs Interest From Global InvestorsJames Paton
PanAust Ltd. has been approached by other investors interested in helping fund its copper and gold project in Papua New Guinea after receiving a cash bid from China’s Guangdong Rising Assets Management Co.
The “strategic and financial investors” also have a “broader interest in the company,” Managing Director Fred Hess said Wednesday in a phone interview after the copper producer rejected a new offer from Guangdong Rising that valued the company at A$1.1 billion ($840 million).
“We’re entertaining all options that allow us to realize greater value for shareholders,” he said.
Guangdong Rising, PanAust’s largest shareholder, should pay more than A$1.71 a share if it wants to boost its ownership, the Brisbane-based company said earlier. PanAust fell 0.3 percent to close at A$1.735 in Sydney trading.
“With PanAust’s share price now trading above the GRAM offer price, it suggests that the market also agrees with this view,” according to the statement. The PanAust board is open to talking with the state-owned Chinese investor to determine whether the two sides can agree on a price, the company said.
Guangdong’s cash offer, 40 percent higher than PanAust’s share price before the bid last month, is “unconditional and not subject to the board’s recommendation,” the Chinese company said in a separate statement.
The cash bid in March was unsolicited and made when both the producer’s shares and copper and gold prices were trading at or near five-year lows, PanAust said at the time.
PanAust, seeking to develop one of the world’s largest undeveloped copper and gold deposits at Frieda River, last year rejected Guangdong Rising’s previous offer of A$2.30 a share.