Ownership tussle emerges for CBH Resources
Wednesday March 17, 2010
A new ownership tussle has emerged for CBH Resources after two separate offers to shareholders in the past week.
Major CBH Resources shareholder Toho Zinc and Belgian Company Nyrstar NV are both vying for shareholder approval of their proposals to acquire CBH shares.
CBH shareholders had been due to consider an offer from its major shareholder Toho Zinc at the end of this month, with the company’s directors recommending the proposal be accepted.
However CBH was placed in a trading halt on Thursday afternoon after a proposal from Nyrstar NV (which made an offer on the company in December last year that was rejected).
The company was due to make an announcement about the Nyrstar proposal early this week, but was yesterday again placed in a trading halt after receiving a revised proposal from Toho Zinc.
In a statement to the ASX yesterday CBH managing director Stephen Dennis said a committee of directors (independent of Toho Zinc) is currently assessing the merits of the Toho and Nyrstar proposals.
Under the latest Toho offer, the company would make a proportional takeover offer to all CBH shareholders at 25 cents per share (excluding Toho shares), and would gain a relevant interest in the company of no more than 49.9 per cent of CBH shares.
The Nyrstar proposal offers 19.5 cents per share.
Toho Zinc, which currently holds 24.1 per cent of CBH shares and 50.6 per cent of CBH convertible notes, has indicated its intention not to support the Nyrstar offer.
Speaking to regional media last week, Mr Dennis said the original Toho offer was a “watershed” for the company.
“We’ve come through a difficult period and we are going to emerge as a survivor,” he said.
Toho’s current offer includes the sale of a 50 per cent stake in the Rasp Mine at Broken Hill, which would allow CBH to continue to draw profits from the mine once it is operational.
Nyrstar’s proposal last week said there was “no certainty” that the Rasp Mine would be developed under the original Toho offer, as CBH would be unable to fund its 50 per cent share.
However Toho Zinc said it did not consider the Nyrstar proposal to be superior, given that Nyrstar has not made “any financial commitment to CBH” and does not appear to have acquired any shares.
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