By Amin Kef (Ranger)
Leonoil Company Limited has taken a bold step to secure full ownership of Sierra Rutile Holdings Limited, presenting a comprehensive off-market takeover offer. The proposal targets all ordinary shares of Sierra Rutile that Leonoil does not already own, offering a cash price of $0.18 per share.
The bid, set to close on September 9, 2024, comes at a crucial time for Sierra Rutile. The company’s Board of Directors has unanimously recommended that shareholders accept the offer, highlighting the slim likelihood of a superior proposal and the company’s potential need for additional capital in the near future.
In a detailed update, Sierra Rutile emphasized that the offer represents a 12.5% premium over the previous bid from Gemcorp Commodities. With no minimum acceptance condition, the Leonoil offer provides shareholders greater certainty and an attractive premium.
Leonoil’s acquisition strategy marks the third significant takeover attempt for Sierra Rutile within the past four months. The Board of Sierra Rutile supports the proposal as it aligns with the company’s strategic goals, particularly with the development of the Sembehun project, which is critical to extending the mine’s lifespan.
Shareholders are advised to promptly accept the offer, as it provides a clear pathway toward financial stability and avoids potential dilution risks tied to future capital requirements.
