SYDNEY Aug 28 Intrepid Mines launched
a friendly A$58.6 million ($54.7 million) all-share offer on
Thursday for Blackthorn Resources, which plans to build
a copper mine in Zambia, and announced a A$110 million share
Intrepid, which pitched its offer at 1.078 Intrepid shares
for each Blackthorn share, has been looking for a new investment
after receiving an A$80 million settlement for being ousted from
an Indonesian copper project by a local partner.
Intrepid also agreed to buy back up to A$110 million of its
shares at A$0.30 a share prior to the merger.
The offer gives Blackthorn stock an implied value of A$0.356
each, a 50 percent premium based on the average price of the two
companies' shares over the past three months.
Blackthorn's board has recommended shareholders accept,
saying Intrepid would inject needed capital to help pay for
pre-development work on its Kitumba copper mining project,
located 200 km (125 miles) west of Zambia's capital Lusaka.
It estimates it will cost an initial $680 million to build
the mine, which will yield an average 58,000 tonnes of copper a
"The Kitumba copper project offers a lot more value than is
currently recognised by the market, and we are confident that
our cash resources can both add value and unlock this discount
over time," Intrepid Chairman Ian McMaster said.
If the deal proceeds, Intrepid Managing Director Scott Lowe
will be named an executive director focusing business
Lowe was previously managing director of Blackthorn, prior
to the sale of the company's interest in a zinc mining venture
in Burkina Faso to Glencore International Plc
Intrepid in February signed a series of binding agreements
settling a dispute for A$80 million with its former partner, PT
Indo Multi Niaga over ownership of the Tujuh Bukit project in
Indonesia, regarded as one of the richest undeveloped gold and
copper discoveries in the world.
(1 US dollar = 1.0714 Australian dollar)
(Editing by Richard Pullin)