Asante Gold has received a revised unsolicited expression of interest (EOI) from Fujairah Holding, which currently holds 11.43 percent of the Canadian miner’s outstanding shares.
Fujairah have submitted amended and shared a revised proposal to the Asante Gold for the takeover consideration.
This comes after Asante Gold had turned down an initial takeover proposal by Fujairah Holding LLC, a global investment company based in UAE that owns an 11.43 percent stake in the West Africa-focused miner.
Last Thursday, Asante confirmed it has received an unsolicited, non-binding expression of interest from Fujairah to acquire all remaining outstanding common shares it does not own at a price of C$2.20 per share. At market close, the stock was trading at C$1.51 a share.
Following a review of the proposal, the board of directors had determined that it is “not in the best interests of the company or its shareholders,” Asante said in a news release.
Specifically, the board said that the takeover interest is “highly conditional” and “fails to address Asante’s near-term financing requirements.”
Amongst the conditions listed, the company is required to cease existing discussions and negotiations with all parties other than Fujairah in respect of any debt or equity financing of any kind.
According to Asante’s statement, this was an “unacceptable condition that would have required the company to cease various alternatives that it has been advancing to satisfy its near-term financing requirements.”
Other conditions include the completion of satisfactory due diligence during a lengthy exclusivity period, negotiation of a definitive agreement, and receipt of all required regulatory and shareholder approvals.
As a result, the board at Asante has concluded that it has “no indication as to Fujairah’s current intentions, including whether it intends to submit an additional proposal or otherwise attempt to acquire the company’s shares.”
It added that “the company does not undertake any obligation to provide any updates with respect to the non-binding expression of interest or any other proposals, except as required under applicable law.”
Consequently, on Monday April 23, 2023 Fujairah has submitted a fresh proposal subject to the request of Asante Gold.
The UAE based company expressed its readiness for further discussions, subject to some amendments and possible intervening financing support.
It said in a statement dated April 23, 2023 that “We acknowledge receipt of your response dated 19 April 2023 on the subject matter above. We appreciate your instant actions to review our proposal and we note that you generally see merit in the Proposal and are open to further discussions, subject to some amendments and possible intervening financing support.
“In the light of the above, we have amended and shared a revised proposal to the Company dated 23rd April 2023. More specifically on the exclusivity period, we have revised it considerably on the back of the Company’s dire need of immediate financing. In addition to discussing a potential acquisition of the outstanding shares of Asante, Fujairah Holding LLC (“Fujairah”) is available to work with Asante to explore alternative financing to address its immediate financing needs.
“To accelerate the proposed transaction, we kindly request an exclusivity period of two weeks in order that Fujairah completes its due diligence exercise and enter into a Definitive Agreement to implement same. This period is contingent on the Company granting us access to its universe of information bordering legal, tax and accounting, and technical material issues. To this end, kindly find attached our review of your confidentiality agreement for your urgent action.”
“Fujairah is committed to responsible mining practices, will continue to prioritize environmental, social, and governance considerations, while remaining committed to delivering long-term value and growth for investors, employees, and the communities in Ghana where Asante operations are situated,” stated Razak Awudulai, Fujairah’s local Representative in Ghana.
Fujairah is a global investment firm that manages a diversified investment portfolio dedicated to generating steady returns and prudently growing capital through a disciplined investment process.
Fujairah Holdings is based in Al Hilal City, Emirate of Fujairah.
Fujairah holding currently has an investment of US$12 Billion across various sectors and is focusing to increase to US$15 Billion by 2024. It has interests in Oil & Gas, Hospitality, Education, Logistics, Manufacturing and Mining.
By Vincent Kubi