Sundance ditches Hanlong takeover agreement
Central West Africa-focused Australian junior iron ore miner Sundance Resources has terminated the A$1.37 billion ($1.42 billion) takeover talks with Chinese private company Hanlong Mining.
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Sundance announced, on Monday April 8, that it had discontinued talks with Hanlong after the Chinese company failed to dispatch its second A$5 million ($5.14 million) payment by April 3 to fund the junior minor’s short-term operations, following on from its failure to deliver credit-approved term sheets from its Chinese investors by March 26.
Hanlong also informed Sundance that it would be unlikely to meet other conditions.
China’s National Development & Reform Commission (NDRC) would not grant final regulatory approval to Hanlong for the takeover unless it found a large Chinese partner to co-operate with – the latest delay in the takeover talks, which started in 2011.
“While it is disappointing, after all this time, that we will not complete this transaction, the board of Sundance believes it is in its shareholders’ best interests to terminate the agreement with Hanlong,” Sundance chairman George Jones said.
“This will enable us to focus all our efforts on discussions with other parties [that] have expressed strong interest in the Mbalam-Nabeba project [in West Central Africa],” he added.
Hanlong has requested that NDRC withdraw the provisional approval for the Hanlong takeover, to allow other Chinese companies to bid for Sundance’s 35 million-tpy project straddling the landlocked borders of Cameroon and the Republic of the Congo.
Sundance is in discussions with other potential strategic partners in China, as well as looking to progress talks with non-Chinese entities, it said.
Many Central African iron ore juniors pinned their hopes for the infrastructure development needed to access seaborne markets, on the Sundance-Hanlong deal going through.
Australia-listed Sundance halted and later suspended trading in its shares on March 19. Trading of the junior’s shares will recommence on Tuesday April 9.