Rand Mining and Tribune Resources have spurned an “opportunistic” $150 million offer for their share in a lucrative gold operation from major miner Northern Star.

The two companies own 12.25 per cent and 36.75 per cent respectively of the East Kundana joint venture, a high-grade underground gold mine near Kalgoorlie in Western Australia.

Northern Star Resources (ASX:NST) owns 51 per cent of the joint venture, but wants it all.

Both Tribune (ASX:TBR) and and Rand (ASX:RND) say the  Northern Star offer was “opportunistic” and “significantly undervalued” their interests in the joint venture.

Rand and Tribune made $22.1 million and $42 million in profits, respectively, from East Kundana in the last financial year.

Bad timing

The offer followed a Takeovers Panel ruling that gave 24 per cent of the Tribune to ASIC to sell off.

The Takeovers Panel found that Tribune managing director Anton Billis had a 60 per cent stake in the company via his own holdings and a number of associated holdings.

The Panel said Mr Billis’ relevant interest in Tribune had not been disclosed in a substantial holder notice at any time.

“It follows, in our view, based on facts that did not appear to be contested, that the market has been uninformed to a very significant degree, and over a lengthy period, as to the persons who have substantial interests in, or control of, Tribune and Rand,” the Panel said.

Both Rand and Tribune share the same board of directors, as well as the same registered office in Perth.

Rand held a large shareholding in Tribune, while Tribune was Rand’s largest shareholder with about 44 per cent.

“In reaching its conclusion, the board considered qualitative factors, such as the timing of the offer, which the board considers to be opportunistic in light of the Takeovers Panel’s declaration of unacceptable circumstances in relation to the affairs of the company, and financial advice provided by its financial adviser, Argonaut,” Tribune told investors.

Northern Star says neither the Tribune and Rand Boards nor their financial adviser whad been in contact about the offers, and the proposed deal hadn’t been put to Tribune or Rand shareholders.

Northern star holds 10,000 shares in Tribune and a 4.9 per cent stake in Rand.

Northern Star paid fellow gold major Barrick about $75 million for the 51 per cent share in East Kundana as well as another gold mine in 2014.