Blumont Group has agreed to make an off-market takeover bid for Australia-listed mineral exploration and development company Genesis Resources, the group said on Friday.
Singapore-listed Blumont will offer 16.9 Australian cents (19.1 cents) for each Genesis share, paying a premium of about 87.8 per cent above the volume-weighted average price of Genesis shares on Wednesday.
Blumont will pay for the takeover by issuing up to 509.5 million new shares, representing about 16.5 per cent of its enlarged share capital.
It will offer 5.3 shares at 7.19 cents apiece for every two Genesis shares. The implied issue price of the Blumont shares represents a premium of 1.27 per cent to the closing price of its shares on Thursday.
Blumont was among three penny stocks that lost about $8 billion in market capitalisation in October last year, after a spectacular crash in its share price.
Genesis owns a portfolio of quality gold, iron, manganese, uranium and base metal in the Proterozoic and Phanerozoic metallogenic provinces of northern and central Australia. It holds seven exploration licences covering more than 1,136 sq km in Queensland and the Northern Territory of Australia.
Its key focus, however, is the Plavica project within the Carpathian Volcanic Arc in Macedonia, a major epithermal province running through Eastern Europe, which is "highly prospective for gold, copper and silver mineralisation", Blumont said.
Genesis has the right to acquire a 62 per cent interest in the project, which it estimates to contain inferred mineral resources of 1.86 million ounces of gold, 28.2 million ounces of silver and 33,900 tonnes of copper.
Blumont said it based the bid price on Genesis' closing share price and its net asset value as at June 30 last year, as well as negotiation with the Australian firm's management. No valuation report was conducted for the Genesis shares.