Rex Minerals (ASX:RXM) has struck an all-cash deal with Mach Metals Australia, which will acquire the company for $393 million via a scheme of arrangement.
Mach is offering $0.47 per share, which is a 79% premium to the junior copper-gold explorer’s 30-day volume weighted average price (VWAP) and 98% to the 90-day VWAP.
The market welcomed the news, pushing shares up to an intra-day peak of $0.455, an over 65% increase on last Friday’s close of $0.275.
More than 45 million shares changed hands during the course of trade today.
Prior to the offer, Rex had a market capitalisation of $211.2 million, and following the news today that has jumped to just under $338 million.
Rex says the offer emerged during a competitive global partnering process focused on the $854 million funding and subsequent development pathway for the Hillside Copper-Gold Project in South Australia.
Rex Minerals CEO Richard Laufmann says the transaction provides certainty of value and a significant premium, as well as the opportunity for Rex shareholders to realise their investment at a 10-year historical share price high.
“This transaction also represents a more certain outcome for wider stakeholders in Hillside, including the local community, the South Australian Government and Rex employees,” he says.
“Subject to approvals, we look forward to working with Mach through to completion and watching them develop the Hillside Project, Australia’s largest fully permitted and shovel ready copper project.”
The deal is subject to approval by Australia’s Foreign Investment Review Board given Mach’s Indonesian origins, as well as shareholder approval.
Mach Australia was established in 2015 and is fully owned by the Salim Group, one of Indonesia’s largest conglomerates.
The company currently owns a 15.8% stake in Rex.
Rex says the tie-up is not subject to any financing or due diligence conditions.
The board unanimously recommends the takeover offer in the absence of a superior proposal and subject to the findings of the independent expert’s report.
All directors of the board plan to vote in favour of the deal.
Macquarie Capital is acting as financial adviser and Baker McKenzie as legal adviser to Rex.
Write to Angela East at Mining.com.au
Images: Rex Minerals
