Theta Gold makes a play for Focus – Creamer Media’s Mining Weekly

PERTH (miningweekly.com) – Junior Focus Minerals on Thursday urged shareholders not to take any action regarding an unsolicited off-market takeover offer from fellow-listed Theta Gold Mines.

Theta on Thursday announced plans to acquire all shares in Focus, offering two of its own shares for every one Focus share held. The offer valued Focus shares at A$0.36 each, representing a 41.2% premium to the company’s closing price on December 8.

Theta said that its offer would allow Focus shareholders to become members of a larger, more liquid and more geographically diverse group.

Focus recently announced a A$45.69-million capital raise, as well as plans to resume gold mining at the Coolgardie operations, in Western Australia. The capital will be raised through a one-for-one non-renounceable entitlement offer, at an issue price of A$0.25 a share.

Theta has argued that the entitlement offer would result in a significant and highly dilutive share issue, and has been structured to allow major shareholder Shandong Gold to increase its level of control in the company. Shadong’s interest in Focus would increase to 66.25% following the entitlement offer.

Theta said that its offer represented an attractive alternative to Focus shareholders, but was conditional on Focus determining that it would not proceed with the entitlement offer.

The suitor has called on Focus to establish an independent board committee, excluding Shandong Gold nominee directors, to consider the Theta offer.

Should Shandong Gold not accept the Theta offer, the suitor was hoping to aggregate minority holdings in Focus, which would allow it to exercise influence to encourage the development of the Focus assets, Theta said.

Should Theta be successful in its bid to acquire Focus, the company would look to develop the Focus assets, particularly the Coolgardie project.

“Theta believes that the offer represents a compelling opportunity to Focus shareholders to realise value for their shareholding while continuing to have an indirect interest in the Focus assets,” said Theta chairperson Bill Guy.

“A combination of Theta Gold and Focus will create a group with a significant presence on the ASX, operating bases in South Africa and Western Australia, and over 12-million ounces of gold resource under management.

“Focus also has numerous old mine sites in the Eastern Goldfields with good grades and potential at depth, and Theta Gold believes its experienced underground mining management team could add value to any consideration of these assets.

“In essence, Theta Gold considers that its offer is a more attractive proposition to Focus shareholders than an uncertain and highly dilute development proposal put forward by Focus.”

Focus said on Thursday that its board was considering the unsolicited offer, and was awaiting a bidder’s statement.