By YEHIURA HRIEHWAZI in Brisbane
NEWCREST Mining Ltd – Australia’s largest gold mining company – is seeking opinions of Lihir Gold Ltd’s shareholders on its failed bid to buy it out for A$9.2 billion (K23 billion).
A Newcrest spokesperson told The National yesterday from its Melbourne (Australia) head office: “We are now seeking the views of Lihir shareholders.”
Newcrest is currently in joint venture with Harmony gold developing the Hidden Valley gold mine in Morobe province.
The spokesperson said: “The offer remains on the table and we will be speaking to shareholders over the next week and a half.
“A combination of Lihir and Newcrest is a good opportunity for Newcrest but not vital.
“Newcrest has in place a strong organic growth pipeline offering 40% growth over the next five years plus other assets which offer significant additional growth opportunities.
“It is a full and fair offer … it represents a 35% premium to Newcrest and Lihir’s closing share price on Feb 12 – the last trading day prior to Newcrest’s initial approach to Lihir in February,” the spokesperson said.
Meanwhile, market analysts in Australia predicted that Newcrest could increase its offer to Lihir to A$10.2 billion (K25.7 billion) to gain control of Lihir Gold which owns the company’s flagship mine on Lihir Island in New Ireland province and other mines in Australia and West Africa.
The Australian newspaper reported that while Newcrest’s offer of A$3.87 pre-Easter share offer is ‘’still on the table’’, analysts say it might have to find another billion dollars before its offer would be acceptable to the Lihir board.
Under the terms of a stand-still agreement signed during negotiations with Lihir, Newcrest cannot submit another bid for nine months – unless it is an offer favourable to Lihir’s board and new chief executive Graeme Hunt.
Lihir rejected an offer last Thursday that would give shareholders one Newcrest share for every nine Lihir shares, plus A$0.225 cash per Lihir share.
Most commentators believe A$3.87 (K9.75) was always going to be a starting point for further talks, particularly given Newcrest’s surprise at Lihir’s public rejection of its offer.