West African Gold Miner Ampella Puts Up Sale Sign
Ampella Mining, a gold explorer focused in West Africa, has put up the sale sign albeit concerns it might not be able to hit the sale funds it expects.
The miner's current value is placed at around A$250 million or $260 million, or about $1.05 per share as of Monday. However, these shares were still short of the company's 52-week high of $3.02 a share, The Australian reported.
Ampella Mining was concerned the current low performance of its shares will lead to a low takeover bid, especially since "several global players in the gold sector," according to the Wall Street Journal, have expressed interest to acquire the Perth-based miner.
"We have had approaches from serious global players in the gold sector and we concluded that we had a duty to all shareholders to properly test whether any one of those parties is prepared to make an offer to acquire Ampella on terms that would be attractive to our shareholders," Peter Mansell, Ampella Mining Chairman, said on Monday.
The Australian said an initial list showed a number of Canadian-named gold producers, including Montreal-based Semafo, the operator of the 190,000-ounce-a-year Mana goldmine located 300 kilometres off from Batie West. Semafo is a $1.4-billion company without debt and holds $180 million cash on hand.
Ampella Mining had "received further expressions of interest and requests for access to due diligence from other gold companies. Rather than continue to deal with these requests on an ad hoc basis, the Ampella Mining board has resolved to instruct its financial and legal advisers to undertake a targeted process to test whether any party with an interest in Ampella Mining is willing to put forward a proposal attractive enough to win the unanimous support of the board," the company said in a statement.
The sales process could take 2 to 3 months, Ampella Mining said, noting it wouldn't be releasing market updates on the status of discussions with interested parties until a final decision has been made.
Ampella Mining maintains some A$55 million dollars in cash on its balance sheet.