Strategic Minerals gains 15pc after catching the eye of suitor QGold
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Privately-held explorer QGold has launched a cash offer for ASX-listed gold junior Strategic Minerals.
Brisbane-based QGold is offering 40c per share for Strategic Minerals (ASX:SMC), valuing the company at $28.2 million – a 14.3 per cent premium to its share price prior to the on-market bid.
Investors liked the news, pushing the shares up 15 per cent to the offer price shortly after market open.
Strategic Minerals, which is developing the Woolgar gold project in Queensland, slipped to a 52-week low of 28c in late September.
The company updated the historic resources for the Lost World, Explorer Camp, Grand Central and Soapspar deposits at the project in October. Woolgar now hosts around 1.8 million ounces of gold.
QGold is a private company that owns exploration permits in Queensland and has just one director – Christopher Wallin.
The suitor believes its offer for Strategic Minerals is a good one because it is a double-digit premium to Strategic Minerals’ last trading price prior to the announcement and the 90-day volume weighted average price.
QGold cautioned shareholders in its bidder’s statement that if they don’t accept its offer, Strategic Minerals’ share price could fall below the offer value.
The company has given shareholders until March 30, 2018 to accept the offer.
Strategic Minerals has been contacted for comment.