Shandong Gold Mining has ended an almost year-long battle for the ownership of Cardinal Resources after winning a 50 per cent interest in the West African focussed company.
Shandong beat out fellow would-be purchasers Nordgold, Engineers & Planners Company and Dongshan Investments in the takeover tussle.
This gives the Chinese gold producer a controlling holding of Cardinal and its Namdini gold project in Ghana, Africa.
Nordgold closed its takeover bid for Cardinal on December 23, stating that while it held the Namdini project “in the highest regard,” it could not justify offering higher than Shandong’s price of $1.07 per Cardinal share, weighed up against the risks of the mine development in an unfamiliar jurisdiction.
“The takeover offers for Cardinal have played out over an extended period but ultimately resulted in a strong outcome for all shareholders,” Nordgold chief executive Nikolai Zelenski said.
“Nordgold has a strong record of capital discipline and cash flow generation, having built three global mines, each on time and budget.
“In the case of Cardinal, the competitive bidding and strong Australian dollar have taken Nordgold to a very substantial profit on its investment.”
Meanwhile, Dongshan’s conditional offer did not satisfy Cardinal’s conditions of Dongshan obtaining a relevant interest of at least 50.1 per cent in the company.
The Cardinal board also noted that Dongshan would be unlikely to offer acceptance for a number of months, which led to its decision to not engage further with its offer.
Ghana contractor Engineers & Planners Company also failed to satisfy Cardinal’s conditions of exceeding $1.05 per share for the company, after joining the fight for Cardinal in November.
The takeover tussle has previously come to the attention of the Australian Government Takeovers Panel, with Nordgold stating that Cardinal had been “misleading” about its shareholder intentions to accept or reject a takeover bid.
The takeovers panel, however, turned down the requests to change offer conditions.
Cardinal has been working on the development of the Namdini gold project and released the Namdini feasibility study in late 2019.