On November 8, Mercantile announced it was attempting to make a takeover bid for half of its unowned shares in Bauxite Resources. Mercantile had expressed displeasure at the slow pace of progress of Bauxite’s ventures as a primary reason for the bid.
Today, Bauxite Resources has delivered an official response. In response to Mercantile chairman Ron Brierley’s comment that “it is time to call a halt” after 10 years of “unsuccessful” searching, Bauxite chairman Robert Nash responded in a release:
“The company considers the statement misleading. It is important to set out some facts about what has been achieved by the company since the listing in 2007.”
Bauxite cited its successful exploration and establishment of the Fortuna resource, its joint venture Felicitas resource, its discipline regarding capital management in recent years and focus on future silica prospects as company achievements that delivered shareholder value. The chairman also stated that the company had seen a substantial reduction in cash burn over the last 18 months, including significant cuts in fees for staff and directors.
The board has reiterated its advice to shareholders to take no action in relation to the bid.