from:http://www.theaustralian.com.au/business/papillon-in-trade-h...

from:

http://www.theaustralian.com.au/business/papillon-in-trade-halt-as-transaction-firms/story-e6frg8zx-1226932356425#

THE long-awaited takeover offer for African gold explorer Papillon Resources finally looks to have arrived.

Papillon, the product of dealmakers Ian Middlemas and Mark Connelly, went into a trading halt pending a “potential corporate transaction”.

The company has long been seen as ripe for a takeover, given its sole asset — the Fekola gold deposit in the West African nation of Mali — ranks as one of the premier gold development assets in the market. While the quality of the Fekola resource has caught plenty of eyes, Papillon management is thought to have been warning potential acquirers that it would take an offer of $2 per share or more to win the board over.

The stock last traded at $1.45, suggesting a buyer would need to be willing to offer a handsome premium valuing the group at more than $600 million if they are to strike a friendly deal. Yesterday was a public holiday in both Britain and North America, meaning markets were closed and there were no telltale trading halts that could give away the identity of the potential buyer.

London-listed Randgold Resources has been rumoured to be on the acquisition trail ever since it secured a $US200m facility last year for “general corporate purposes”. It is said to have plenty of liquidity and, having just come through a phase of high capex, would like to bring another development asset into its portfolio.

Another possible suitor is said to be Canada’s B2Gold, which is best known to Australians for its $1.1 billion merger with ASX-listed Philippines goldminer CGA Mining.

Fekola boasts a resource of 5.15 million ounces at an average grade of 2.35 grams per tonne.