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Independent expert concludes Stanmore's Target's statement not fair or reasonable

Published by , Assistant Editor
World Coal,

Stanmore Coal has released a Target’s statement in response to the unsolicited, conditional off-market takeover from Golden Investments Pte Ltd. The independent expert, BDO Corporate Finance (Queensland) Ltd estimates the controlling interest value for Stanmore shares is between AUS$1.48 and AUS$1.90 and has concluded that the offer is not fair and not reasonable to Stanmore shareholders. The Stanmore Directors recommend that shareholders reject the offer, on the basis it significantly undervalues the company’s shares.

Stanmore Chairman, Stewart Butel, said: The offer is clearly inadequate against a range of comparisons and does not account for the positive outlook for Stanmore and the company’s pursuit of strategies and initiatives to maximise shareholder value.”

“Stanmore is positioned to deliver its forecast FY19 underlying EBITDA guidance of AUS$130 million to AUS$150 million and enhanced operating margins over time. Our capital light strategy provides the company with the flexibility to rapidly respond to cyclical movements in coal prices.”

“The Directors believe that accepting Golden Investments’ offer will deprive Stanmore shareholders of the opportunity to consider and subsequent superior offers and to participate in any potential future growth in the Stanmore business.”

To reject the offer, shareholders should take no action in relation to the Gold Investments offer.

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