China's Hanlong Mining to buy Australia’s Sundance Resources for A$1.4 bn
18 Jul 2011
China's Hanlong Mining Investment, today offered to buy the remaining shares it does not already own in Sundance Resources, for A$1.4 billion ($1.5 billion) in cash.
Hanlong, Sundance's majority shareholder with an 18.6 per cent stake has offered to pay A$0.50 a share, a 25 per cent premium to Sundance's closing price of A$0.40 on 16 July.
Central West Africa focused Sundance, which owns a big iron ore deposit on the border of the Republics of Cameroon and Congo, said Hanlong's offer does not provide adequate value or certainty and has urged shareholders to take no action at this stage.
The Perth-based company said it is in advanced talks with potential partners to develop its West African iron ore project, but will also talk with Hanlong about the terms of its offer.
Listed on the Australian Stock Exchange and with a market capitalisation of more than A$1 billion, Sundance is developing its flagship $4.7-billion Mbalam Iron Ore mine, which straddles the borders of the Republics of Cameroon and Congo.
Sundance has been talking to Chinese investors for funding the Mbalam iron ore project, which requires billion of dollars on investment for building of new 500-600km of rail lines, a new multi-user port at Lolabé on the Atlantic coast and other infrastructure.