This is an unqualified proposal, apparently due to the proposed restructuring of Pallinghurst

Pallinghurst Resources has announced that it has received sufficient support to make an offer to buy all of Gemfields shares for $ 150 million unconditional, as more than 60% of Gemfields shareholders, a listed company in the UK mining company and trading in the market, Support the proposed transaction.

"As of 5:40 pm on June 16, Pallinghurst has received confirmed approval for 77,888,324 shares of Gemfields, representing approximately 14.16% of the existing issued share capital of Gemfields," Pallinghurst reported yesterday at the Johannesburg Stock Exchange Johannesburg Stock Exchange).

Taking into account the 47% stake in Gemfields, which are already owned by Pallinghurst, the total number of shares for which consent was obtained was 61.25% today.

"Thanks to this agreement on the offer to Gemfields received before the general meeting, Pallinghurst now has support that exceeds the minimum level required for this offer," said Johannes van Niekerk, spokesman for Pallinghurst. "In addition, there are other notifications of irrevocable support, indicating the existence of votes that may be cast in favor of this proposal at the general meeting of Gemfields."

Consent to the sale of Gemfields shares was received from shareholders who already provided irrevocable support to the Pallinghurst proposal, put forward on May 19, and which include NGPMR, Investec and South African businessman Christo Wiese. However, irrevocable obligations cease to be mandatory if, among other conditions, a competing offer with a 10% premium is received.

Gemfields announced last week that a Chinese company called Fosun Gold, a subsidiary of Fosun International, is considering the possibility of filing a competing bid for the purchase of this company of colored gemstones with a 10% premium to the Pallinghurst offer. Arne Frandsen, CEO of Pallinghurst Resources, said he does not have information about the status of the Fosun proposal. "It's just an indication that they can or can not make a proposal. Therefore, we will have to wait and see, "he said.

As for the offer, if Pallinghurst wins up to 75% of the shareholder support, it will be able to withdraw Gemfields shares from the Alternative Investments Market (AIM) market in the UK; If 90% of shareholders accept the offer, then Pallinghurst will have to extend it until the balance sheet for minority shareholders is balanced.

The Pallinghurst proposal for Gemfields attracted criticism from an independent committee created by Gemfields, who said the proposal underestimates the company and exchanges the liquid shares of the British company on the stock exchange for illiquid shares traded on the Johannesburg Stock Exchange.

Last week, Pallinghurst published a consolidated shareholder report that the first closing of its proposal is scheduled for July 4. She made a proposal to exchange shares of Gemfields, which she did not yet own, on May 19 in the ratio of 1.91 new shares of Pallinghurst for each share of Gemfields.

"This is an unqualified proposal, apparently due to the proposed restructuring of Pallinghurst, which aims to preserve the selfish interests of Pallinghurst investment managers at the expense of independent shareholders of Gemfields," the committee said. He added that Pallinghurst, being an illiquid company, subjects Gemfields minority shareholders to risks associated with more volatile products, such as iron ore, in which Pallinghurst funds are invested.

http://www.miningmx.com/top-story/29858-pallinghurst-wins-61-support-controversial-gemfields-bid/