Pallinghurst Resources has announced that 61 percent of Gemfields shareholders back its takeover offer, in spite of the miner’s board saying the unsolicited offer undervalues the company.
Pallinghurst, founded by former Billiton chair Brian Gilbertson, already controls 47 percent of the company’s shares. Another 14.16 percent of its shareholders say they back the deal.
Under the deal, each Pallinghurst shareholder would get 1.91 shares of Pallinghurst for each Gemfields share. Graham Mascall, chair of the independent committee evaluating the deal, warned this means that company shareholders will be saddled with “inferior assets that offer exposure to more volatile commodities and with less attractive prospects.”
Last week Chinese company Fosun Gold bid for the colored stone company, with a bid that represented a 10 percent premium to Pallinghurst’s.
If the deal goes through, Pallinghurst said it plans to delist Gemfields and “explore strategic alternatives” for Fabergé—the jeweler Gemfields bought in 2012, ironically, from Pallinghurst.
(Image courtesy of Gemfields)
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