Conquest makes offer

for North Queensland Metals

The West Australian June 3, 2010, 8:50 am

Jake Klein
Kalgoorlie Miner / Kellie Lewis ©

UPDATE 12.20pm: Conquest Mining has announced a $58 million takeover offer for North Queensland Metals in a bid to expand its landholding in the State and join the ranks of gold producers.

Under the cash and scrip bid, the company will offer NQM shareholders half a Conquest share and 10 cents cash for every share they hold, valuing the company at 29 cents a share, a 29 per cent premium to yesterday’s closing price of 22.5 cents.

It also represents a 37 per cent premium to the volume weighted average share price (VWAP) of the company over the past month.

Conquest said NQM’s major shareholder, non-executive director Don Walker, supported the offer and had signed a pre-bid acceptance agreement covering his 19.9 per cent shareholding in the company.

NQM holds a 60 per cent interest in the Pajingo gold mine near Charters Towers while Conquest owns the nearby Mt Carlton project with reserves of more than 1.15 million ounces of gold equivalent.

Conquest executive chairman Jake Klein said the combined company would be better placed to increase exploration expenditure at Pajingo and attract and retain high quality people.

“NQM shareholders will benefit initially from the significant up-front offer premium and are expected to benefit over the longer term as value is unlocked by combining the complementary assets and capabilities of Conquest and NQM,” he said.

He said the case for combining the two companies was compelling because it would deliver value to NQM shareholders more rapidly and in excess of that achievable by NQM alone.

Conquest said if the offer was successful, it would have about 453 million shares on issue and former NQM shareholders would own 22 per cent of the combined company.

Conquest has made the offer conditional upon it securing 90 per cent of NQM’s issued capital.

North Queensland Metals urged shareholders to take no action until its board had considered the offer and provided a recommendation.

Shares in North Queensland jumped 4.5 cents, or 20 per cent, to 27 cents by 12.15pm after hitting an earlier peak of 29 cents.

Conquest shares were off 1.5 cents, or 3.95 per cent, to 36.5 cents

Sourced & published by Henry Sapiecha

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