/* Style Definitions */
mso-padding-alt:0cm 5.4pt 0cm 5.4pt;
font-family:”Times New Roman”;
Sundance Resources is attempting to dismiss fears the $1.7 billion takeover bid from China’s Sichuan Hanlong Group is on shaky ground due to insider trading allegations.
Last month the Australian Securities and Investments Commission said it was investigating “suspected insider trading activities in relation to Bannerman Resources and Sundance Resources”.
Hanlong’s former managing director Steven Hui Xiao and ex-vice president Calvin Zhu are part of those embroiled in the case, and were stood down last month.
The investigation is focusing on share trades that took place before and after the announcement of the bid, where Sundance shares climbed 31 per cent.
Last week Sundance directors recommended the Hanlong takeover to investors after the offer was upped 7 cents to 57 cents a share.
But the deal must be approved by the Foreign Investment Review Board before it can be settled, and the FIRB has indicated it is unlikely to make a decision until ASIC concludes its investigation.
Approval from the FIRB hinges on the regulator’s assessment of the public interest of the takeover.
Most of Sundance’s assets are not located on Australian soil however, with the flagship Mbalam rail, port, and iron ore mine located near Cameroon and the Republic of Congo.
In company statements Sundance said it was working “productively” with the FIRB and the takeover still appeared likely to be settled within its expected timeline.
Insider trading investigations frequently take long periods of time to be conducted in Australia.
A former case against Telstra director Stephen Vizard took five years to wind-up, and ASIC previously took six months to bring a case against Citigroup, which it eventually lost 16 months later.