Nova Resources lifts offer for Kaz Minerals to 780p a share
By Michele Maatouk
Date: Thursday 04 Feb 2021
(Sharecast News) - Nova Resources said on Thursday that it has upped its offer for Kaz Minerals to £3.7bn, or 780p a share, after the copper company rejected an earlier offer of 640p.
Nova - which is owned by Kaz's two largest shareholders, chairman Oleg Novachuk and director Vladimir Kim - made its initial offer for the 61% of the company it does not already own in October last year. However, it was rejected by some of Kaz's minority shareholders, who said it did not reflect the group's fair value and prospects.
The sweetened offer has been unanimously recommended by Kaz Minerals' Independent Committee.
Novachuk said: "We are pleased to have reached agreement with Kaz Mineral's Independent Committee as to the terms of a recommended transaction recognising the changing risk profile of the business.
"This increased offer represents a highly attractive return for Kaz Minerals shareholders ensuring they have the opportunity to realise in cash the value of their investment at a compelling valuation."
Broker Liberum said the new offer was "just about acceptable".
Analyst Ben Davis noted that it offers a 9% premium to the broker's undisturbed share price estimate of 717p, which is where shares would currently trade in the absence of a bid.
"There has been vocal opposition, representing at least 13% of the shares against the bidding consortium controlling 49%, who have been pushing for higher bids and could in theory draw out a further increase.
"However, we do not believe that it is worth the risk of the bid failing and the challenge of financing Baimskaya."
Baimskaya is a copper project in Russia.
Liberum, which rates the stock at 'hold', lifted its price target to 780p from 700p.
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