Alamos says not to extend Aurizon tender offer
March 19 (Reuters) - Alamos Gold Inc said it would not extend its offer for Aurizon shareholders to tender their shares after it failed to overturn a break-up fee payable to rival bidder Hecla Mining Co.
Alamos said it would not take up any Aurizon shares that were tendered to its offer. The tender offer is slated to expire today.
Alamos, which is Aurizon's largest shareholder with a 16.11 percent stake, made its unsolicited C$780 million offer in January. Hecla topped Alamos' bid with a friendly C$796 million offer on March 4.
Alamos Gold CEO John McCluskey told Reuters on March 12 that the company was likely to walk away from a bid to buy Aurizon Mines if it loses the regulatory ruling on the merits of a second poison pill adopted by Aurizon and the break fee committed to rival bidder Hecla Mining.
The British Columbia Securities Commission on Monday rejected Alamos' application against the break-up fee of C$27.2 million to Hecla but ruled in favour of Alamos's application for the removal of the poison pill.
"The Aurizon Board, by adopting this unique type of break fee, has foreclosed the opportunity for Aurizon shareholders to tender to Alamos' superior offer," McCluskey said in a statement on Tuesday.
Alamos CEO John McCluskey told Reuters on March 5 that about 13 percent of Aurizon's outstanding shares had been tendered in its favor. However, Aurizon quoted Alamos's counsel as saying during the hearing at the British Columbia Securities Commission (BCSC) that only 6.5 percent Aurizon's shares had been tendered.
Hecla shares closed at $4.08 on the New York Stock Exchange on Tuesday. Shares of Aurizon closed at C$4.48, while those of Alamos closed at C$14.98 on the Toronto Stock Exchange.