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Mining
Toronto and New York listed SilverCorp Metals has sweetened the deal for OreCorp (ASX:ORR) shareholders, securing the support of rich-list investor Tim Goyder in a revised cash and share bid designed to snare a tick for its takeover of the Tanzanian gold developer.
The deal is slated to improve the outlook for the development of the Nyanzaga gold project, with OreCorp shareholders to convene on December 8 in Perth to approve the deal.
Some extra honey has now been thrown in, with SilverCorp upping its offer from 15c to 19c cash along with an offer of 0.0967 SilverCorp shares for each OreCorp share in their back pocket.
The previous offer was already supported by OreCorp’s third largest shareholder, former Diggers and Dealers chairman Nick Giorgetta. Together the players represent upwards of 15% of the register.
With Goyder on side the two biggest dogs in the yard are on the acquirer’s side, along with the Hank Diedrichs led board.
It’s a deal that now comes in at a 26.7% increase in the cash component and 24.9% premium to the closing price of OreCorp shares of 43.5c on August 4 before the deal was announced.
It’s a 12% premium to the OreCorp closing price of 48.5c on November 21.
The additional cash sweetener has come off the back of a big dive in SilverCorp’s shares, which have cratered over 18% since the deal was announced.
A DFS last year on the 2.6Moz Nyanzaga showed it could produce 234,000ozpa over 10.7 years at all in sustaining costs of US$954/oz.
Moving onto another Goyder investment, Chalice Mining’s (ASX:CHN) AGM has just kicked off in Perth and it’s been accompanied by another big fall in its share price.
The Julimar owner has seen its share price tumbled 76% this year, and another nearly 6% this morning.
The bulk of that drop has come since the release a couple months ago of a heavily criticised scoping study, notable for its use of metal price assumption well above current levels.
The pre-development ASX 200 company is now worth $570 million, having topped market cap of $3 billion after the release of the Gonneville resource in late 2021.
Located just 70km north of Perth, the find in early 2020 opened an entirely new mineral province on the western margin of the Yilgarn Craton, and was pitched as the largest platinum group elements find in Australian history, as well as its biggest nickel sulphide discovery in two decades.
But enthusiasm has waned as attention has turned to the cost of building the thing.
With a strategic partnering process still ongoing, chairman Derek La Ferla touched on criticisms of the scoping study in his address to shareholders this morning.
“More recently, however – and particularly following the release of our Scoping Study in late August – it has been a difficult period for the Company and our shareholders,” he said.
“Like many of our peers, Chalice has been impacted by the challenging market conditions facing exploration and development companies. Recent financial and geopolitical instability has seen broad weakness across global markets, particularly in the commodities we are exposed to.
“As outlined in our recent Quarterly Report, it is also clear that market expectations on certain Scoping Study metrics were not met.
“The macro-economic assumptions which drove the indicative scale of the published study cases did not align with current market conditions on account of the Company’s projected development timeline.
“Our senior leadership team – led by our Managing Director and CEO Alex Dorsch – has spent a considerable amount of time meeting with investors in recent months and listening to their feedback and he will address these matters further in his presentation.”
Chalice doesn’t expect to be in production until 2029, with the company looking into higher grade starter cases in its pre-feasibility study work.
Last but not least a bit of a coal round up with Whitehaven Coal (ASX:WHC) securing a minor victory in its battle with activist shareholder Bell Rock Capital.
The Takeovers Panel has delivered a ruling of unacceptable circumstances over the London hedge fund’s engagement in the company, deeming that its long position in WHC shares crossed 5% as early as June 10, 2022, without disclosing to the market that it had become a substantial shareholder.
Including a relevant interest in 4.774% of Whitehaven’s shares, derivatives meant its held as much as 13.041% on June 2023, with Whitehaven having written to the investor on July 7 and October 23 to confirm its interest.
Whitehaven’s complaint came amid a campaign from Bell Rock to vote down its remuneration report at last month’s AGM — where a first strike was recorded — after the hedge fund protested its purchase for up to US$4.1 billion of BHP’s Daunia and Blackwater met coal mines.
The acquisitions do not require the support of shareholders.
The Takeovers Panel, which declined to make interim orders before the AGM vote, has now made orders that Bell Rock compile a corrective notice on their holding in a form approved by the panel.
It already revealed it had to whittle down its relative holding to 5.31% of Whitehaven’s shares on October 30, reducing its long position to below 5% earlier this month.
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