Wyloo Consolidated Investments, a unit of Wyloo Metals, has made an on-market proposal to acquire the remaining shares in Mincor Resources, valuing the Australian nickel developer at A$750m ($504m).
Currently holding a 19.9% stake in Mincor, Wyloo offered A$1.40 in cash for every Mincor share that it does not already own.
The offer price marks a 35% premium to Mincor’s stock close on 20 March 2023.
Mincor is developing a nickel sulphide deposit in Western Australia.
The proposed acquisition forms part of Wyloo’s plan to invest in and develop projects to produce the raw materials needed to support the decarbonisation of the global economy.
In a press statement, Wyloo said: “Wyloo believes that the offer represents attractive value to Mincor shareholders, particularly given the current risks and uncertainties associated with remaining a Mincor shareholder in the face of prevailing economic and equity market risks.
“Wyloo considers these risks may be weighing on Mincor’s valuation, as demonstrated by the 49% decline in its share price over the last 12 months.”
However, Mincor advised its shareholders not to take any action on Wyloo’s offer, which is open from 5 April to 8 May 2023, until they receive a formal recommendation from Mincor directors.
Mincor noted that Wyloo did not declare its bid to be best and final, and warned that the shareholders who would sell their shares on market would not be eligible to take part in any potential higher offer.
Wyloo Metals CEO Luca Giacovazzi said: “Wyloo is providing an immediate opportunity for all Mincor shareholders who wish to dispose of their holdings to do so at a significant premium to Mincor’s last closing price.
“Wyloo’s offer is unconditional; shareholders can sell into Wyloo’s on-market bid today and receive certain cash value for their Mincor shares.”