Saracen ups bid for Bligh's gold project

UPDATED: Saracen Mineral Holdings has increased its offer for Bligh Resources’ Bundarra gold project, and rival bidder Zeta Resources has responded by upping the vaue of its competing proposal.

Bligh told the market Monday morning the majority of its board had recommended shareholders accept Saracen’s revised ‘last and final’ $9 million offer, which now includes both a scrip and cash component.

The offer is an increase from its original all-scrip offer valued at $8.5 million at the time. However, based on share price changes coupled with a 15-day volume-weighted average price variable, the shares were valued at just under $7 million on Friday.

Saracen will issue the same amount of shares as it planned to in the original bid, but will top up any shortfall in cash so that the deal is equal to $9 million.

The offer was considered superior to a competing offer put forward by investment group Zeta last week, which was to acquire all the shares it didn’t already own in Bligh for 3.5 cents each in cash, equal to $8.1 million.

On Monday afternoon, Zeta upped its bid to 3.8 cents a share, valuing the explorer at $8.8 million.

Zeta holds a 19.9 per cent stake in Bligh.

“Having regard to all factors, the directors have decided, by majority, that the Saracen transaction is, on balance, superior to the Zeta offer and have entered into a variation if the share purchase agreement to give effect to the revised Saracen transaction,” Bligh said today.

Saracen managing director Raleigh Finlayson said the acquisition of Bundarra was a sensible bolt-on for the company.

“The financially robust open-pit resources will immediately extend the mine life at the nearby Thunderbox mine, with high-grade extensional results pointing to further growth,” he said.

Saracen shares were 0.3 per cent lower to 95.7 cents each at 10:30am.