“Before a binding offer can be announced, Regis requires the recommendation of the Board of Capricorn, the support of Capricorn’s major shareholders, and execution of a binding implementation agreement. While the Board of Capricorn has confirmed to Regis that it would unanimously recommend the Proposal and significant shareholders Nedlands Nominees Pty Ltd and Centrepeak Resources Group Pty have indicated their support, Capricorn’s largest shareholder, Hawke’s Point (with a 18.9% interest), has to date not been prepared to support the Proposal. Regis is scheduled to meet representatives of Hawke’s Point in the coming week to determine whether it will be possible to secure Hawke's Point's support for the Proposal.
Unless the support of Hawke’s Point can be obtained before opening of the ASX on Wednesday, 3 October 2018, Regis reserves the right to terminate discussions regarding the potential acquisition of 100% of the issued and to be issued shares in Capricorn. Accordingly, there is no certainty that an agreement will be reached which will result in a binding offer being made to Capricorn shareholders.
In any event, Regis reserves its right to make an offer, or further proposal, for 100% of Capricorn if a third party makes or proposes an alternative offer for Capricorn. Should the above pre- conditions to making a binding offer be satisfied, the offer would be subject to customary terms and conditions to be finalised but including 90% minimum acceptance, acquisition or cancellation of all options, no material adverse change and no prescribed occurrence conditions.”
Yes the RMS offer for EXU is different as there is no minimum acceptance. RMS need EXU and will creep onto EXU’s register at any level. ie they will probably keep extending and extending the offer until they get what they want. EXU shareholders who sell into the offer will own RMS share once the offer period ends whether or not RMS manages to take control of EXU or get to the compulsory acquisition level of 90% (which I doubt they will do with the current offer). Once the offer closes the EXU shareholders who have sold won’t be entitled to sell their shares into any higher offer that might come from RMS in the future to wrap the company. The only choice they will have is to buy EXU shares back on market, and around around she goes.
RRL seem to have made it clear they aren’t prepared to play these same stupid games and have indicated that their offer, if it comes, will be subject to 90% acceptance. The way I read this is that unless they get to the 90% compulsory level, no CMM holder will get shares in RRL and the offer fails. That seems like a fair way to do it, not like what RMS are doing. So on this basis RRL will be trying hard to win-over Hawkes Point and in my opinion Hawkes Point will want more, so the chances are the TO proposal either doesn’t go forward or if it does it goes forward on better terms than have been disclosed so far. So yes there is some risk of the price reverting down again but also a good chance of an amount more than 11.4cents equivalent being offered IMO.
In anycase if Hawkes Point think they can get a better deal I’ll stick with their decision as they have the most to gain or lose by sending RRL paxking. The project is not going away, if anything it will just get bigger and the wolves will be back at the gate before not to long.
Also with respect to the 3 Oct 2018 deadline to get Hawkes Point’s consent to the deal, RRL have just said that they reserve the right to terminate discussions. That doesn’t mean that they will terminate discussions. I expect that they should see eye to eye by then or be giving each other the thanks but no thanks as people walk out the door. Also there is nothing stopping RRL going hostile like RMS have done. I just wouldn’t want to see another predatory TO like RMS’s on one of these small developers. The mid-tiers will shoot themselves in the foot if they all start carrying on like RMS because people will stop risking money to go and explore and find new deposits if the outcome is a stingy offer that doesn’t make the risk taking investors any significant money. These small companies have worked hard to acquire, discover and remove risk from these ore bodies and if the bigger companies aren’t prepared to pay for the value of derisking these projects then the whole system will grind to a halt. The bigger companies will need to get off their backsides and go out and go through the whole process themselves as other people won’t be bothered anymore. Esh
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