Cameroon Business News: Hanlong Makes A Bid For Sundance
Yaounde, Cameroon Africa(Cameroon News) – Chinese mining company, Hanlong has put across a bid to secuire control of the rwmining ownership of Sundance Resources.

Sichuan Hanlong Group has indicated the willingness to shell out an amount of A$1.2 billion ($1.3 billion) in cash to secure the ownership of the remaining portion of Sundance Resources Ltd. The move will help them to secure control of the Australian company’s iron ore project in West Africa.

Hanlong, which has 18.6 percent of Sundance, provided 50 cents a share for the company that operates out of Perth, approximately valued at A$1.4 billion, Sundance said today in a statement. The Chinese company is willing to pay 25 percent more than Sundance’s closing price on July 15.

Buying Sundance will hand over to Hanlong complete rights of the $4.7 billion Mbalam iron ore mine, port and railroad project that extends along the border of Cameroon and Republic of Congo. The Chinese company said last year it will flush is as much as A$5 billion in resource assets to meet the increasing requirement for commodities in the world’s biggest economy.

“It’s a trend that we’ve seen and it’s now well developed over the last couple of years,” said David Lennox, a mining analyst at Fat Prophets. “They believe their country requires considerable resources going forward just to maintain stable growth for many years to come.”

Sundance share prices rose to as much as 29 percent to 51.5 cents in Sydney and traded at 47 cents at 12:41 p.m. local time. Sundance has in its list of consultant big names like UBS AG, Clayton Utz and Citic Securities Co. Bank of America Merrill Lynch and Mallesons Stephen Jaques would be the as financial and legal consultants to Hanlong in the deal, the company revealed in a separate statement.

Wait And Watch!!!

Sundance have requested shareholders not to act immediately, indicating that the bid undervalues the company and that the board “intends to engage in discussions with Hanlong about the terms of its proposal,” according to the statement.

The bid comes after Hanlong’s A$143 million proposal for Australian uranium miner Bannerman Resources Ltd. on July 11. Hanlong also has a 53.82 percent stake in Australian molybdenum prospector Moly Mines Ltd., according to data put together by Bloomberg.

The offer is estimated at 47 percent more than Sundance’s weighted average share price over the past 20 trading days, according to information. That is in comparison with the average premium of 26 percent for takeovers of iron ore companies worth more than $1 billion along the past five years.

Typical Premium

“We’ll need to be able to see what the offer works out over time but” a typical premium that tags along with most takeover bids is approximated close to 30 percent to 40 percent, Peter Rudd, mining and resources manager at Armytage Private Ltd. in Melbourne said in a telephonic conversation.

There has been $6.9 billion worth of bids for iron ore manufacturers this year, which does not include the Sundance offer, according to statistics. This number is the highest since 2008 when agreements to the tune of $8.4 billion were announced.

Sundance, which is also on the lookout for partners to help finance the project, said it will resume talks with potential partners, the statement said.

About Sundance Resources

Sundance Resources is an Australian mining and development company operating out of Perth with a lot of prestigious projects in West and Central Africa. Its most prestigious iron ore project, Mbalam Iron Ore Project lies across the Cameroon- Democratic Republic of Congo border and the company aspires to be one o the world’s top iron ore producers by making use of the resources that is extracted out of the project.