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Mineral Resources

Mineral Resources announces takeover bid for Mesa Minerals

Mineral Resources (ASX: MIN) and Mesa Minerals (ASX: MAS) wish to announce that MRL intends to make a recommended off-market takeover bid to acquire all of the issued shares in Mesa.

The Takeover Offer is one MRL Share for every 70.6 Mesa Shares. The Takeover Offer values each Mesa Share at $0.1025, based on the last traded price of MRL Shares on the ASX on 19 March 2010 of $7.24.

This represents a 65% premium to the 30 day volume weighted average price of Mesa Shares on the ASX to 17 March 2010 of $0.062.

MRL and Mesa have entered into a letter agreement in relation to the Takeover Offer under which the directors of Mesa have unanimously recommended the Takeover Offer and advised that they intend to accept the Takeover Offer in relation to the Mesa Shares held or controlled by them.

MRL Chairman Peter Wade, said “the integration of Mesa Minerals? manganese and technology assets into the Mineral Resources operations will provide a significant step in executing the strategy for Mineral Resources to become a volume based player in the steel making commodities business."

"Inclusion of the Mesa assets will enhance the already impressive inventory of resource assets held by Mineral Resources, ” Wade added.

Mesa Minerals Chairman, Norman Coldham-Fussell, said “the Offer allows Mesa shareholders to continue to benefit from the development of its own projects and technology assets, while gaining exposure to a high growth, diversified and financially robust company which will apply its expertise to Mesa's assets."

"Mineral Resources is a profitable, dividend paying company, and joining with them offers excellent future value for our shareholders,” Coldham-Fussel said.

The Offer is conditional on either the withdrawal of all the resolutions to be considered at the extraordinary general meeting scheduled for 26th March 2010 or all of those resolutions being defeated at the meeting. Other conditions are set out in Annexure A of this announcement.

MRL said The Takeover Offer adds further near term manganese ore production to MRL's high quality portfolio of assets. Furthermore, MRL?s expertise in project development and operation will assist in the development of the Ant Hill and Sunday Hill tenements.

Mesa shareholders are being offered a material premium to the trading price of Mesa shares, both current and prior to the extensive on market buying by some of the shareholders who have requisitioned the upcoming extraordinary general meeting.

Accepting shareholders will also benefit from significantly higher liquidity in MRL's shares, as well as gaining exposure to MRL's growing number of producing and development projects.

Mesa shareholders will also retain an interest in the technology assets through their shares in MRL. MRL said the value of the technology assets will be significantly enhanced by MRL's construction expertise, strong balance sheet and supply of feedstock for the proposed secondary processing plant.

The company said the construction of the plant will unlock value for MRL by allowing currently unsaleable low grade manganese fines to be processed and sold as manganese sulphate.

A break fee of $610,000 is payable by Mesa to MRL in the event: (a) a competing proposal results in a third party acquiring a relevant interest in more than 50.1% of all Mesa Shares; (b) a majority of Mesa directors withdraw, qualify or change their recommendation or determination to accept the Takeover Offer in a manner adverse to MRL; or (c) Mesa executes any agreement in relation to a superior proposal prior to the expiry of the offer period for the Takeover Offer.

Mesa has also given MRL standard "no shop" undertakings and has agreed to advise MRL, if any third party commences due diligence in relation to Mesa.

The Takeover Offer will extend to any additional Mesa Shares issued as a result of the conversion of existing convertible securities.