Lundin Mining says it plans to make a restructured $1.4-billion cash offer for Nevsun Resources Ltd after a previous attempt fell through.
However, Nevsun said Tuesday the renewed takeover offer ignores the fundamental value of the company.
The company urged shareholders to take no action in response to Lundin’s announcement, noting that no formal offer has yet been made.
In May, the Lundin partnered with Euro Sun Mining Inc. on a roughly $1.5-billion takeover offer that was a combination of cash as well as shares in both Lundin and Euro Sun.
Nevsun’s board rejected the previous offer because it said it overvalued Euro Sun’s shares and because the company’s involvement raised other uncertainties.
Euro Sun amended its offer in June, but the latest offer has Lundin going it alone with a bid of $4.75 cash per share.
Nevsun says the latest offer of $4.75 per share in cash is less than the $5 in cash and shares in an expression of interest by Lundin earlier this month.
Lundin says the offer represents an 82 per cent premium to Nevsun’s closing price on Feb. 6, when Lundin says it first indicated an interest in acquiring Nevsun’s copper-gold Timok project in Serbia, and a 33 per cent premium to Nevsun’s closing price on the day Lundin announced its previous offer.
Shares in Nevsun, which operates the Bisha Mine in Eritrea and the Timok project in Serbia, closed down nine cents at $4.21 on the Toronto Stock Exchange on Monday.
Vancouver-based Nevsun operates the Bisha Mine in Eritrea and the Timok project in Serbia.