Nordgold hopes to clear the air on sales of shares in Cardinal

Gold miner Nordgold on Wednesday announced that it would supplement its on-market unconditional cash offer for ASX-listed Cardinal Resources with an off-market offer on equivalent terms, in the hopes of swaying the Cardinal board’s vote in favour of its own offering.

The suitor on Wednesday said that both Cardinal and its Chinese suitor Shandong Gold Mining have attempted to create a ‘misleading and inaccurate’ impression that Shandong’s unconditional A$1 a share bid was in some way preferred to Nordgold’s own unconditional bid.

To redress the issue, Nordgold said that it would make an off-market takeover offer for all of the outstanding Cardinal shares on the same terms as its on-market offer, subject to obtaining certain technical relief. The off-market offer will also be free of conditions, and will provide accelerated payment terms, at an offer price of A$1 a share, subject to there being no higher competing offer.

If a higher competing offer is made, Nordgold said that it would increase its offer price to a price that could defeat the higher competing offer, and any other competing offer from Shandong.

Furthermore, Nordgold was also proposing to make an offer to certain of Cardinal option holders for their options, at the same terms as those offered by Shandong.

The miner has noted that it was not ‘credible’ to suggest that a genuine third party would emerge and overbid the best and final offer of A$1 a share from both companies, pointing out that after more than seven months of a battle for control of Cardinal, the best and final offer prices from both Nordgold and Shandong have increased to a 67% premium over Shandong’s initial bid.

Nordgold has also questioned Shandong’s decision to extend its own offer period until the end of the year, given Cardinal’s expressed desire to move ahead with the development of the Namindi gold project, in Ghana.

A previously completed feasibility study into the project estimated that it would produce some 4.2-million ounces of gold over a mine life of 15 years, with an estimated 1.1-million ounces expected over the first three years of the operation. Namindi is expected to cost $390-million to develop.

Nordgold is seeking an abridgement of the usual two-week delay between service of its off-market bidder’s statement and the opening of its off-market offer period, with the off-market bid scheduled to close after the minimum one month period, unless extended.


Nordgold noted that as Cardinal’s largest shareholder, the company stood ready to provide support to ensure the successful progression of the Namindi project, adding that its own West African operating and mine development expertise, coupled with its singular focus on safety, environment and sustainability, qualified Nordgold as the preferred developer for the gold project. 

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