Hanlong Mining has reached an agreement with Sundance Resources to acquire 100 per cent of the Australian company's shares. Hanlong has offered to pay Aus$0.57 cash per Sundance share, valuing Sundance at Aus$1.65 billion.
The offer price represents a premium of 42.5% to the closing price of Sundance shares on July 15, 2011, the last trading day prior to Hanlong’s initial proposal, 65.3% to the one month volume weighted average price (VWAP) to July 15 and 56.3% to the three month VWAP to July 15.
The Board of Sundance has unanimously recommended the offer in the absence of a superior proposal and subject to an independent experts report. Hanlong is the largest shareholder of Sundance.
The chairman of Hanlong parent company Sichuan Hanlong Group, Liu Han, welcomed the agreement and said he looked forward to working with Sundance to complete the transaction for the benefit of all stakeholders.
“The agreement we have reached with the Board of Sundance allows Sundance shareholders to realise a substantial premium for their investment and we look forward to working with Sundance to complete the transaction as soon as possible.
“In addition, the agreement will also bring great benefits to the people of the Republic of Cameroon and the Republic of Congo through the additional certainty it brings to the development of the Mbalam and Nabeba projects. We have always believed Hanlong was the natural developer of these projects and we intend to move forward with the development accordingly.
“Hanlong remains committed to ongoing investment in Australia and Australian resources companies as we seek to build a global, diversified mining company,” Liu Han said.
Hanlong and Sundance will work together to progress the receipt of the Mining Convention for Mbalam and Mining Permit for Nabeba with the governments of the Republic of Cameroon and the Republic of Congo respectively.
Sundance Resources is an international resources company developing the Mbalam Iron Ore Project in the Republic of Cameroon and the Republic of Congo, in central west Africa.