[miningmx.com] — THE Australian Stock Exchange (ASX) has for the third time in as many months queried Gold One International on the company’s share trades and corporate activities, this time seeking clarity on the transaction with Rand Uranium.
Writing to Gold One on May 6, the ASX demanded an explanation as to why the junior miner did not disclose the proposed $250m takeover of Rand Uranium when the group responded to a so-called price and volume query from the ASX on April 21.
Gold One eventually informed the markets about the Rand Uranium deal on April 28.
“Please advise why the company did not make an announcement or request a trading halt on receipt of the price query letter and in light of the initial announcement (Gold One’s response to the query),’ read the letter from the ASX.
Gold One responded that the offer to Rand Uranium was only accepted on Saturday April 23, and that the 17.67% stake China’s Baiyin Nonferrous Group bought in the firm was responsible for the share and price movements related to the previous query.
“At the time of release of the price query response letter, no binding arrangement had been entered into in relation to the acquisition.
“The acquisition remained at that time confidential and incomplete, and a reasonable person would not have expected it to be disclosed at that time. The reason for the increase in the price of the company’s shares and in trading volume was entirely unrelated to the acquisition.’
Gold One eventually asked for a temporary trading halt on April 27, the first trading day in Australia after April 23, and announced the Rand Uranium transaction on April 28.
The firm once again confirmed, as it did in response to its first price and volume query on March 30, that it was in talks which could culminate in a takeover of Gold One. It also might do more takeovers of its own.
“Gold One is currently assessing a potential acquisition opportunity as well as a potential change of control transaction.’
Gold One’s shares have lost steam since Baiyin took a major stake in the firm, trading at A$0.425 on Tuesday, down 19.9% since the A$0.53 high. It’s shares listed on the JSE followed a similar pattern, now trading at around R3.27 from a R3.70 high (down 11%).
Three analysts Miningmx spoke to said the jury was still out whether Rand Uranium was a good fit for Gold One.
Read an Investec Securities report dated May 6: “Until we have developed an understanding of the Rand Uranium assets we would prefer to reserve judgement on the merits of the acquisition.
“The catalysts for the recent re-rating have been a combination of recognition of mine performance and potential for M&A activity. In the near term, M&A activity is likely to be the key driver dictating sentiment towards the stock.’
