Zhaojin lifts bid for Tietto
In a last-ditch effort Zhaojin Capital has increased its bid for ASX-listed West African gold producer Tietto Minerals by 17 per cent declaring it the “best and final offer”.
Hong Kong-based Zhaojin Capital, which is a wholly owned subsidiary of China’s Zhaojin Mining Industry Company, increased its offer from 58c to 68c, valuing the South Perth-headquartered company at around $768m.
Zhaojin said it represented a 67 per cent premium to the five-day volume weighted average price of Tietto as at October 27, the last trading day prior to the initial off-market offer. The company said the offer will not be increased.
The Tietto Board has recommended that shareholders take no action until they have evaluated the new offer and make an updated recommendation.
The Board noted that the new offer remained below the valuation range of 79c to 93c a share determined by independent expert Grant Thornton Corporate Finance. The Board also said that the spot gold price has increased materially since that valuation.
A Zhaojin Mining Industry spokesman said they had been working the past few months to clear key regulatory approval conditions. Also, alongside Australian FIRB approval already received, Zhaojin Capital has now received key regulatory approvals for the offer in China and considers that regulatory approval in Cote d’Ivoire is not required. “This has allowed us to come back to Tietto shareholders with a significantly increased best and final offer price of A$0.68 per Tietto share,” he said.
Zhaojin is Tietto’s second largest shareholder, owning 7.02 per cent of Tietto prior to the offer. Zhaojin has extended the offer period to May 2 and it remains conditional upon a 50.1 per cent minimum acceptance condition.
Tietto started producing gold from its Abujar project in the Ivory Coast in July 2023 and managing director Matt Wilcox said the company produced a record 37,111oz in the March quarter. Tietto shares closed 1.5 per cent higher at 66c.