Struggling CBH Resources has suddenly found itself the most popular kid on the block with either the third or fourth proposal to the company in as many months for a controlling stake.
Investors liked the idea, the shares jumped to 19c from 17c after a trading halt was lifted after two days yesterday.
They ended at 18.5c, up 1.5c or nearly 9% on the day.
That was after Japan’s Toho Zinc lifted its level of interest, and cash on the table for a stake in zinc miner CBH with the hope of knocking out a rival, higher offer from Nyrstar of Belgium.
CBH said in a statement that Toho was now offering 25c a share for a maximum 49.9% of the company.
That compares to the 19.5c for all of the company in an offer from Nyrstar revealed last Friday. That values CBH at $213 million.
The Nyrstar offer topped its previous 13.5c a share offer, which CBH had rejected in favour of a placement deal with Toho, its major shareholder and supporter through the deep slump.
A committee of independent CBH directors is assessing the merits of each revised offer from Toho and Nyrstar, and a recommendation will be made to shareholders as soon as practicable, the company said yesterday.
Under the Revised Toho proposal, Toho will make a proportional takeover offer to all CBH shareholders at 25c per ordinary share, so that Toho would have a relevant interest in no more than 49.9% of total issued shares of CBH.
Toho currently holds a 24.1% stake in CBH, so in effect it has lifted its offer to 25c a share for the outstanding 25.8% it wants from other shareholders.
It had previously proposed a placement of 50 million CBH shares at 20c each.
Under unaltered conditions of Toho’s proposal, CBH will also sell half of its Rasp project at Broken Hill in New South Wales to Toho for $57.5 million.
Following the completion of these transactions, CBH plans to make an offer of $500 in cash and 1800 of its shares per convertible note for all of its outstanding convertible notes.
Toho’s proportional takeover is subject to shareholder approval of the other transactions.
Nyrstar, one of the world’s largest zinc producers, last week upgraded its takeover bid to 19.5c per share from 13.5c for CBH.
Toho indicated today it would not support the revised Nyrstar proposal, as both a shareholder and noteholder.
"As a result, Toho Zinc believes that Nyrstar’s revised proposal in its present form would fail and that it therefore does not represent a genuine or realistic alternative to the Rasp transactions," Toho said in a statement.
Friday’s Nyrstar offer jolted Toho into quick action. It’s now up to the Belgium company to reply.
In its favour is that everyone will get 19.5c a share (Toho says it won’t sell, and why should it if it prepared to offer first up 20c, and now 25c a share).
It’s now up to Nystar to top its offer up to closer to the 25c a share on the table from Toho.
