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Gemfields Reluctantly Bows to Fosun Takeover Bid
Jun 20, 2017 9:46 AM
By Rapaport News
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RAPAPORT... Gemfields’ management has recommended shareholders accept a $323.8 million (GBP 256
million) takeover offer from China’s Fosun Gold, describing it as a better
option than an earlier proposal by Pallinghurst Resources.
Gemfields’ independent committee still considers the Fosun
offer to be unfair and unreasonable, but finds it more attractive than the
Pallinghurst bid, which offered investors no premium on the gemstone miner’s
share price, the company said Tuesday.
Pallinghurst, a mining-focused private-equity group,
announced last Friday that it had secured acceptances from 61% of Gemfields
shareholders, including its own 47% stake.
Fosun has upped its bid by 10% to $0.569 (GBP 0.45) per
share since its initial proposal last week. The new offer represents an 18%
premium to Gemfields’ share price of $0.48 (GBP 0.3813) at the close of business on May 18, the last business day
before Pallinghurst announced its offer.
“Given the challenges that the unsolicited
Pallinghurst offer poses to the independent future of the company, and given [its]
derisory nature..., the independent committee intends to recommend that
shareholders accept the Fosun offer so as to secure a relatively more
attractive outcome for their investment,” Gemfields said in its Tuesday
statement.
To this end,
Gemfields CEO Ian Harebottle and chief financial officer Janet Boyce have
agreed to accept the offer in their capacity as shareholders. |
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Tags:
colored gemstones, Fosun, Fosun Gold, Gemfields, gemstones, Ian Harebottle, M&A, mergers and acquisitions, mining, Rapaport News
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