AurionGold fires parting shot as deadline looms

Placer Dome (PDG-T) has lowered the broker inducement fee it will pay in relation to its bid for all of the shares of AurionGold after the Aussie gold miner raised concerns about the size of the fee with the Australian Takeovers Panel.

Placer has dropped the fee to 0.75% of the value of the consideration payable to accepting shareholders, up to a maximum of $750, from 1.5%. Acceptances tendered by 1:30 p.m. (AEST) on August 6 will be paid the original 1.5% fee.

AurionGold’s CEO, Terry Burgess, said in a prepared statement, “We are pleased that the Takeovers panel recognised our concerns that the size of the fee offered by placer Dome had the possibility of inducing brokers to place undue, and possibly coercive, pressure on their clients to accept the Placer Dome offer.

AurionGold’s board has steadfastly rejected Placer Dome’s advances since May 27, when the company launched its hostile bid. Most recently, AurionGold’s board recommended that shareholders reject Placer’s sweetened offer that included a A35-per-share cash boost to its original offer of 17.5 of its own shares for every 100 AurionGold shares.

Placer’s bid is set to expire at 7 p.m. (AEST) on August 7.

AurionGold also reiterated that Placer Dome is free to extend its bid prior to closing, and that in the event that more than 50% of AurionGold shares are tendered to the offer during its final week, Australia law requires that the offer be automatically extended for 14 days.

So far Placer has had about 11.5% of AurionGold’s outstanding stock tendered to its offer. Nearly 10% of that came from South African-based Harmony Gold (HGMCY-Q), AurionGold’s major shareholder.