THE BOURSE WHISPERER: Northern Star resources (ASX: NST) has trumped Metals X (ASX: MLX) to win the backing of the Board of Tanami Gold (ASX: TAM) for the acquisition of Tanami’s Central Tanami project (CTP).
Earlier this month Tanami had struck a binding conditional joint venture heads of agreement with Metals X in regards to the project.
Just as the ink was drying on the deal, Northern Star has swooped in with, what Tanami described to be, “an unsolicited alternative proposal”.
“After careful consideration, (the Board of Tanami) is of the opinion (the NST offer) is superior to the transaction contemplated by the Metals X HoA and that the Tanami Board intends, subject to there being no superior proposals, to vote in favour of the NST Transaction and against the Metals X transaction,” Tanami Gold said in its ASX announcement.
“The Tanami Board is pleased to advise that it has entered into binding conditional joint venture heads of agreement with Northern Star pursuant to which, Northern Star will progressively acquire a 60 per cent joint venture (JV) interest in the CTP.”
The terms of the Northern Star Heads of Agreement include:
Northern Star will, at completion, acquire a 25 per cent initial interest in the CTP for a payment of $20 million, comprising of:
An $11 million cash payment; and
The issue of approximately 4.29 million fully paid ordinary shares in Northern Star.
“The Directors of Tanami have carefully considered the terms and conditions of both the Metals X transaction and the Northern Star transaction and, in their opinion, the Northern Star transaction is superior to the Metals X transaction,” Tanami said.
Both deals are to be voted on at a shareholders general meeting, however the directors of Tanami have made their position clear and it would appear as through the Metals X deal is to be voted down.