If Diatreme Resources’ takeover bid of neighbouring Metallica Minerals goes ahead, the merger would create the country’s largest silica sand mining company. Photo: Supplied.
The boss of silica miner Diatreme Resources has given remaining shareholders of the neighbouring miner it is targeting for takeover a simple message: accept the offer or risk being “stuck” in a minority.
The company, which is running the ambitious Northern Silica Project at Cape Flattery, near Hope Vale, announced on 5 July it had secured a 71.2% stake in Metallica Minerals, giving it effective control of the Brisbane-based company.
The takeover would create Australia’s biggest silica sand mining entity.
Diatreme Resources has also restructured Metallica Minerals’ board to ensure group synergies can be fully realised, with Greg Starr and Michael Chapman appointed as directors of the takeover target from 8 July.
Stephen Everett has joined the pair as an independent director, while Theo Psaros and Mark Bojanjac have resigned from the Metallica Minerals board.
Diatreme Resources’ off-market takeover offer remained open for Metallica Minerals shareholders until 9 July, a situation chief executive officer Neil McIntyre said would allow remaining shareholders, for a limited period, to accept Diatreme Resources shares or risk being “stuck” in an illiquid minority position within Metallica Minerals.
“We strongly urge the remaining Metallica shareholders to immediately accept Diatreme’s offer and gain the benefits of the combined group,” he said.
“This offer is only open for a limited time and may not be further extended.”
Mr McIntyre said a successful takeover would create a “leading ASX-listed silica company with a pro-forma market capitalisation of approximately $110 million and a significant combined mineral resource base”.
“Diatreme has the financial capacity, technical expertise, industry partners and third-party stakeholder relationships required to advance the silica assets of the combined entity in the interest of all combined shareholders, with the aim of bringing the projects into timely production,” he said.
“This will create Australia’s pre-eminent silica sand miner, strategically located in proximity to fast-growing Asian markets and also with the potential to supply a domestic solar [photovoltaic] manufacturing industry.
“Importantly, it will generate new employment, training and business opportunities for the community of Hope Vale and Cooktown, with a focus on ensuring the benefits flow to all local stakeholders, including Traditional Owners.”
