The directors of Polaris Metals yesterday recommended the company’s shareholders accept the takeover bid from Mineral Resources, after both parties negotiated an improved offer.
The parties agreed to increase the offer to one Minerals Resources share for every 12 Polaris shares and also introduced a cash component of five cents per Polaris share.
This new offer values each Polaris share at 65 cents, which is more than more double the 30 cent closing price on 14 August, prior to the announcement of the offer.
Mineral Resources has also removed the 50.1% minimum acceptance condition and will remove all remaining conditions upon acquiring that amount of Polaris shares.
The closing date for the offer has been extended by to weeks from 26 October to 9 November.
In a statement, the Polaris board said it considers the improved Polaris offer superior to the rival Lion-Asia Resources bid announced on 6 October.
“Under the Lion-Asia offer, Polaris shareholders would receive 60 cents cash per share,” the board said.
“Based on the $7.24 closing price of Mineral Resources shares on 14 October, the implied value of the improved offer is 65 cents per Polaris share, a premium of approximately 8.3% to the Lion-Asia offer.
“The board has determined to reject the current Lion-Asia offer and continues to recommend that Polaris shareholders accept the Mineral Resources offer, in the absence of a superior proposal.”
According to Minerals Resources managing director Peter Wade, “The company now has a relevant interest in 29.19% of Polaris ordinary shares.”
“We strongly believe our increased offer represents our unwavering desire to play a meaningful role in rapidly advancing the current Polaris assets towards production,” he said.