The directors of Australian coal miner Felix Resources have given their full support to the takeover offer from Chinese State-owned Yanzhou Coal Mining Company Limited, the company told its shareholders in a statement yesterday.
“The Felix board of directors believes that the offer is in the best interests of shareholders. The directors unanimously recommend that Felix shareholders vote in favour of the offer,” the company said.
Under the terms of the deal Felix shareholders will receive a cash payment of $16.95 a share, as well as a payment of dividends totaling $1.00 per share, funded primarily from the company’s cash reserves.
According to Felix, the payment to shareholders represents a 28.5% premium to the company’s three month VWAP (volume-weighted average price).
Accepting the takeover offer will give the company’s shareholders a degree of security they will otherwise not have, Felix chairman Travers Duncan said.
“The Yanzhou offer allows shareholders to benefit from the certainty of a cash consideration which fully values Felix, without taking on the risks associated with Felix’s next phase of growth,” he said.
“We believe that Yanzhou is well positioned to continue Felix’s development to the benefit of all stakeholders.”
Felix intends to maintain its headquarters in Australia and is committed to contributing to the domestic economy in the future, Duncan said.