Ramelius Resources Limited (ASX:RMS) has advised Explaurum that following a period of due diligence it is unable to improve the terms of its off-market scrip takeover offer.
This decision has prompted Explaurum to state that it is now focused on implementing the Alkane placement transaction.
In a statement that company said: “The Alkane transaction has been recommended by the Explaurum board as superior to the current Ramelius takeover offer.
“It is also noteworthy that Alkane entered the placement transaction after completing its own due diligence activities on Explaurum and the Tampia project.
“Alkane’s placement issue price of 12 cents per share represents a 26% premium to the implied Ramelius takeover offer price of 9.5 cents per share as at close of trade on November 26.
“The Alkane transaction also has no change of control implications.”
Alkane to hold 12.2% stake
Alkane’s $8 million placement funds, which will result in it holding a 12.2% stake in Explaurum, will be used to complete a bankable feasibility study for the Tampia project in WA.
They will also be used to aggressively accelerate drilling across the Tampia region, including at the Mace deposit.
This work is expected to advance the Tampia project to a final investment decision during the first quarter of 2019.
Tampia has 675,000-ounce resource
Tampia, which is about 250 kilometres east of Perth in the Central Wheatbelt region of WA, has an initial ore resource containing 675,000 ounces at 1.79 g/t gold.
Explaurum stated: “Both Explaurum and Ramelius would like to acknowledge that the recent engagement between the two companies was constructive and undertaken in good faith by both parties.”