CBH directors recommend Toho proposal
March 17, 2010
A committee of directors of CBH Resources Limited (CBH), independent of the company’s largest shareholder Toho Zinc Co., Ltd, said it considers the revised Nyrstar Proposal cannot be successful in its current form and instead endorsed the revised Toho Proposal and recommended it to CBH shareholders, subject to no superior proposal emerging. The committee said that given the voting thresholds that apply under a scheme of arrangement, Nyrstar’s recent revised proposal would clearly fail.
CBH said the revised Toho Proposal would involve CBH shareholder approval for the sale of a 50% interest in the Rasp Project at Broken Hill to Toho for $57.5 million, the establishment of a joint venture for the ownership and development of the Rasp Project, and the sale of the company’s 50% share of zinc and lead concentrates from the Rasp Project to Toho for the life of the Rasp Project.
The company said other elements of the proposal include Toho making a proportional takeover offer for ordinary shares in CBH at 25c per share, so that Toho would have a relevant interest in not more than 49.9% of total issued shares of CBH, and CBH would make an offer of $500 in cash and 1,800 CBH shares per CBH Note for all of CBH's outstanding Notes
Managing director, Stephen Dennis, said Toho’s revised proposal would provide shareholders the opportunity to receive significant near term gains on a portion of their CBH shares, and the opportunity to participate in the future growth of the company through the development of the Rasp Project and the planned increase in production at the Endeavor Mine.
”The de-levering of the company, along with Toho’s undertaking to support CBH in financing the Rasp Project, will also ensure that this important new mine is brought quickly into production,” Mr Dennis said.
As at 1046 AEDT, CBH shares were trading at 18.5c.
CBH said the revised Toho Proposal would involve CBH shareholder approval for the sale of a 50% interest in the Rasp Project at Broken Hill to Toho for $57.5 million, the establishment of a joint venture for the ownership and development of the Rasp Project, and the sale of the company’s 50% share of zinc and lead concentrates from the Rasp Project to Toho for the life of the Rasp Project.
The company said other elements of the proposal include Toho making a proportional takeover offer for ordinary shares in CBH at 25c per share, so that Toho would have a relevant interest in not more than 49.9% of total issued shares of CBH, and CBH would make an offer of $500 in cash and 1,800 CBH shares per CBH Note for all of CBH's outstanding Notes
Managing director, Stephen Dennis, said Toho’s revised proposal would provide shareholders the opportunity to receive significant near term gains on a portion of their CBH shares, and the opportunity to participate in the future growth of the company through the development of the Rasp Project and the planned increase in production at the Endeavor Mine.
”The de-levering of the company, along with Toho’s undertaking to support CBH in financing the Rasp Project, will also ensure that this important new mine is brought quickly into production,” Mr Dennis said.
As at 1046 AEDT, CBH shares were trading at 18.5c.
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