looks like it is all over, page-7

kcn has .. 22 per cent ..bells sounds 4 next roun Indeed an interesting little squabble.


SMH Business

Feuding goldminers set for another round

Kate Askew
July 12, 2006


THE acrimony between gold miner Kingsgate Consolidated and its takeover target, Andean Resources, threatens to continue in the wake of the expiry of Kingsgate's drawn-out $100 million bid.

Last night Kingsgate had acceptances for about 22 per cent of Andean - well short of control of the company - after Macquarie Bank hedge fund Macquarie Newton accepted for its 3 per cent Andean stake. Macquarie's project finance arm, which also owns Andean shares, was not planning to accept the offer.

Kingsgate's board is unlikely to get a friendly reception if it continues to push for its chief executive, Gavin Thomas, to remain on Andean's board as a non-executive director. The Andean board has vowed to continue its efforts to remove Mr Thomas from its board at an extraordinary general meeting scheduled for July 24, the same day as Andean's next board meeting.

"They're trying to get Gavin off the board," said Kingsgate chairman Ross Smyth-Kirk. "He's the only person in there who knows about the [Cerro Negro gold project]. They're in danger of ending up as a shell company.

"I doubt whether [Andean's board] will stand the test of time."

He said it was too early to say whether it would push for another Andean board seat.

Kingsgate's takeover raised eyebrows when it was launched in March because Mr Thomas was a director of the takeover target and had been heavily involved in Andean's Cerro Negro project in Argentina.

At the time, Kingsgate said Mr Thomas had no involvement in the decision to bid for Andean and had provided no confidential information on Cerro Negro to the Kingsgate board.

There is also the prospect of another round of takeover activity.

Andean, for its part, is understood to have several North American companies continuing to conduct due diligence over Cerro Negro.

The due diligence process began in April and has been lengthy because the interested companies have had to do their own modelling on the Cerro Negro resource. The process so far has drawn out several offers to farm-in to Andean's prospect.

Andean shareholders who accepted will not get the increased Kingsgate 1-for-14 offer because Kingsgate had not won acceptances for 25 per cent of Andean. They will get one Kingsgate share for every 15 of their Andean shares.