Panoramic Resources Ltd (ASX:PAN) has recommended that shareholders take no action in relation to an off-market takeover offer from Independence Group NL (ASX:IGO) that saw Panoramic shares surge almost 42% in early trade to 46 cents.
The offer is for one IGO share for every 13 Panoramic shares held which represents an implied offer price of 47.6 cents per Panoramic share and an equity value of approximately A$312 million.
Board recommendation
In a response to IGOs offer, the company said: “Panoramic Resources notes the announcement from Independence Group NL regarding its unsolicited, highly conditional scrip takeover offer for Panoramic.
“The Board of Panoramic advises shareholders to take no action in respect of Independence Groups offer or any document received from Independence Group.
“The Board will evaluate the offer and Independence Groups Bidders Statement and provide shareholders with a recommendation in due course. Until then, shareholders should take no action."
IGO: “Attractive premium”
IGO said that the offer represented “an attractive and significant premium” compared to Panoramics trading levels:
- 42% to the closing price of Panoramic shares on November 1, 2019, being the last trading day before the announcement date;
- 51% to the 1-month VWAP of Panoramic shares up to and including November 1, 2019; and
- 52% to the 2-month VWAP of Panoramic Shares up to and including November 1, 2019.
Independence Group has a relevant interest in almost 25 million shares, representing around 3.8% of the total issued capital of Panoramic.
Nickel “expertise”
It said: “IGOs extensive capability and expertise in underground mining and processing of nickel sulphides and exploration for nickel sulphides places IGO in an ideal position to unlock value from the Savannah operation and Panoramics exploration portfolio.”
IGO has outlined what it says are “a number of very compelling reasons” for Panoramic shareholders to accept the offer:
- De-risk their investment in Panoramic within a stronger, larger, more diversified and liquid vehicle;
- Unlock enhanced operational and exploration potential through IGO's strong technical, financial and operating capability;
- Retain and enhance exposure to attractive nickel market dynamics;
- Benefit from IGOs attraRead More – Source
