* Offer of C$4.65 way below net asset value - Aurizon CEO
* Says other potential buyers have contacted Aurizon
* Alamos shares fall 4 percent; Aurizon down nearly 2
Jan 24 Alamos Gold Inc said it could
not sweeten its C$4.65-per-share offer for Aurizon Mines Ltd
as the fellow Canadian miner has not provided any new
information to warrant a revision of the bid.
Aurizon, operator of the Casa Berardi gold mine in Quebec,
on Wednesday advised shareholders to reject the C$780 million
($781.1 million) unsolicited bid, calling it inadequate and
"Research analysts' consensus opinion to the net asset value
of the operating mine is C$600 million," Aurizon Chief Executive
George Paspalas told Reuters.
Analysts, on average, have valued the Joanna gold
development project at C$195 million, he said.
"Those two components calculate up the net asset value for
Aurizon of C$4.83 per share. We got about C$200 million of cash
on the balance sheet, we have no debt. So you can see ... it is
way in excess of C$4.65 which Alamos has offered," Paspalas
StarMine's intrinsic valuation suggests Aurizon's stock
should be trading at C$2.96, compared with the offer price of
C$4.65 and Wednesday's closing price of C$4.76.
StarMine's models take into account analyst estimates for
growth, usually over five years, and then model the typical
growth trajectory of companies over a longer period of time.
"Other potential buyers have contacted us and we have
contacted other candidates as well," Paspalas said, without
disclosing any details.
Aurizon has also adopted a shareholder rights plan, or a
poison pill, to find alternatives to the Alamos offer.
Alamos, which currently owns more than 16 percent of Aurizon
and is its largest shareholder, said on Thursday it will apply
to securities regulators to have the poison pill lifted before
the offer expires.
The offer is open until Feb. 19, unless extended or
The Aurizon CEO said he has been talking to shareholders and
many of them believe that the bid doesn't represent fair value.
"I have had a number of shareholders tell me directly they
are not tendering in at this price."
Alamos has said its offer has the support of four large
Alamos, which owns and operates the Mulatos mine in Mexico,
said the circular issued by Aurizon on Wednesday provides no new
information that would cause it to modify the offer.
Aurizon shares were down nearly 2 percent at C$4.67 on the
Toronto Stock Exchange, while Alamos shares fell 4 percent to
C$15.44 on Thursday afternoon.