Vulcan proposes MC Mining takeover at higher price than Goldway offer

MC Mining confirmed receiving a proposal from Vulcan Resources, the operator of the Mozambique’s largest coking coal mine Moatize, on Friday.

The AIM-traded firm said Vulcan had made a non-binding proposal for an off-market cash takeover offer for all shares in MC Mining at an indicative price of between 17 and 20 Australian cents per share (9p and 10p), valuing the Company's equity between AUD 69.34m and AUD 81.58m.

It said the proposal was subject to customary conditions, including the completion of a due diligence process, and was not currently a binding offer capable of acceptance by MC Mining shareholders.

The independent board committee (IBC) noted that the the indicative price range proposed by Vulcan surpassed the current takeover offer price of 16 Australian cents per share from Goldway Capital Investment.

It was thus advising shareholders not to accept the existing offer from Goldway.

MC Mining’s IBC said it would assess the indicative terms of Vulcan’s proposal, seeking guidance from financial and legal advisors, namely Adelaide Equity Partners as financial advisor, K&L Gates as Australian legal advisors, and Falcon & Hume as South African legal advisors.

At this stage, there was no certainty regarding the receipt of a formal offer from Vulcan or its precise terms.

“MC Mining remains committed to keeping shareholders appraised of developments and intends to make a further announcement when more complete and definitive details are received,” said independent board committee chairman Khomotso Mosehla.

At 1358 GMT, shares in MC Mining were up 10.34% at 8p.

Reporting by Josh White for Sharecast.com.