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(Kitco News) - Musgrave Minerals (ASX: MGV) announced in Monday that after careful consideration, the company’s Board unanimously resolved to recommend shareholders to reject the Westgold all scrip offer of 1 Westgold share for every 5.37 Musgrave shares.
In a statement, the company said that since announcement on June 6, 2023, the Westgold implied offer price has traded below the Musgrave share price.
“We note that as at 23 June 2023, the last practicable day prior to the release of this letter, the Musgrave share price closed at $0.295 compared to the current Westgold implied offer price of $0.250,” it added.
Musgrave noted that the recently released stage 1 prefeasibility study for the Cue gold project illustrates a “technically and financially robust” project.
“The value of Musgrave to Westgold has clearly been articulated in recent announcements, media coverage and analyst commentary post the announced intention to make an offer,” the company said. “The offer is opportunistic given Musgrave’s potential.”
Musgrave Minerals is an active Australian gold and base metals explorer. The Cue project in the Murchison region of Western Australia is an advanced gold project. Musgrave also holds a large exploration tenement package in the Ni-Cu-Co prospective Musgrave Province in South Australia.
The Cue project has an IRR of 95% (pre-tax) and the potential to deliver over 65,000 ounces of gold annually over an initial 5-year period (including 80,000oz/year for the first 3 years) at an AISC of A$1,315/oz and AIC of A$1,675/oz (based on full amortization of start-up capital). The project is expected to be in the lowest cost quartile of gold producers in Australia.
