ASX-listed phosphate explorer Minbos Resources has terminated a planned merger with partner Petril Phosphates after a delay in closing the deal wiped almost $5 million off its market value.

The deal was subject to a number of conditions, which Minbos (ASX:MNB) said were not satisfied or waived and prevented it from completing the transaction.

“The board believes that the value to Minbos shareholders arising from the merger has diminished due to delay in reaching completion, and the board has taken the view that it is no longer in the best interests of Minbos shareholders to continue with the merger,” the company said in a statement.

Minbos shares over the past year. Source:
Minbos shares over the past year. Source:

Minbos, which currently has a market value of roughly $9.8 million, and Petril are equal partners on the Cabinda phosphate project in Angola, Southern Africa and inked a deal in May that would see Minbos acquire all of the shares of Petril in an all-scrip deal.

The company’s market value has dropped by about $4.7 million since it announced the planned merger, with shares hitting a 12-month low of 0.4c in early September.

Investors shrugged off today’s news, with the share price remaining unchanged at 0.4c.

The goal of the merger was to consolidate the ownership of the Cabinda project and add two other Angolan phosphate projects – the 70%-owned Lucunga project and the wholly owned Pedra de Feitico project – to Minbos’ portfolio.

Although the company received shareholder approval in September to go ahead with the deal, there were several other conditions precedent that needed to be satisfied or waived.

Minbos has issued a notice of termination to Petril, but the pair will remain 50/50 partners in the Cabinda project.

The company said it now plans to actively pursue other investments in the resources sector.

Minbos has been contacted for comment.