- Westgold Resources (WGX) is offering to buy all the shares on issue in fellow ASX-lister Gascoyne Resources (GCY)
- The company’s offer involves one WGX share being issued for every four GCY shares held by investors, or roughly 30.3 cents per share
- WGX says its offer is a premium to the proposed merger with Firefly Resources, arguing that merger would result in an 18.3 cent shareprice
- Gascoyne is awaiting a more formal bid from Westgold before it will make a recommendation on the latest offer
- Shares in WGX are down 1.8 per cent at $1.64, while shares in GCY are up a strong 19.4 per cent at 37 cents each just before market close
Westgold Resources (WGX) is offering to buy all the shares on issue in fellow exploration stock Gascoyne Resources (GCY).
The takeover bid comes after Gascoyne knocked back an offer from Rivet Group, with initial plans underway to merge with Firefly Resources (FFR).
Latest bid
Under this latest offer, shareholders would receive one WGX share for every four GCY shares held — pricing each Gascoyne share at roughly 30.3 cents per share.
Westgold argues its offer was a premium to the Firefly deal, arguing a deal with FFR would award GCY shareholders only 18.3 cents per share post-merger.
In a statement released on Thursday, WGX said it “believes that the Firefly Scheme is value destructive to Gascoyne shareholders”.
The company also argues its business is a larger and more well-funded
gold company, labelling itself Australia’s fifth largest domestic gold producer.
Response
Gascoyne is remaining quiet regarding the latest offer, with the company stating it was still awaiting an official bid statement.
It said that currently the Board of Gascoyne was not yet in a position to make a formal recommendation to shareholders.
However, the company was considering its response and pledged to keep shareholders informed of its next steps.
GCY shares were trading at 37 cents each, while Westgold Resources dipped 2.1 per cent to $1.64 per share at 3:41 pm AEST.
Shares in GCY are up a strong 19.4 per cent at 37 cents each while shares in WGX are down 1.8 per cent at $1.64 just before market close.