Placer Dome, AurionGold squabbling continues

Placer Dome (PDG-T) says it is disappointed by AurionGold’s continued rejection of its unconditional cash-sweetened offer for the Aussie company’s shares.

Placer recently added a A35-per-share sweetener to its original offer of 17.5 of its own shares for every 100 AurionGold shares.

According to Placer, a review of AurionGold’s revised debt and hedging positions, along with an increase in estimated reserves, propelled the company to increase its offer. Since the original bid was announced, AurionGold has upped its reserves to 7.7 million oz. from 6.1 million oz., while resources ballooned to 25 million oz.

In a statement on Friday, Placer said, “It now seems clear that there is no interest from third-party bidders.”

Placer’s CEO, Jay Taylor urged AurionGold shareholders to, “accept Placer Dome’s offer and participate in the value expected to be created from the combination of Placer Dome and AurionGold.”

Placer said that based on its closing share price on August 1 on the Toronto Stock Exchange, its bid valued AurionGold shares at A$3.17 apiece. On Aug. 2, AurionGold shares A3 higher at A$3.07 on the Australian Stock Exchange.

But, as has been the case since May 27, when Placer launched its hostile bid, AurionGold’s board has stuck to its guns and maintains that shareholders should not tender their shares to the bid.

The company also reassured shareholders that, contrary to statements to the contrary, Placer’s bid in fact would be automatically extended for 14 days should the company acquire more than 50% of AurionGold’s shares in the last week of the offer. Placer’s offer currently expires on Aug. 7.

AurionGold says Placer’s bid, even with the added cash, represents a discount of more than 10% to its share price immediately prior to the announcement of the offer.

By Aug. 2, Placer had received acceptances from 10.11% of AurionGold shareholders, including a 9.8% held by South African-based Harmony Gold (HGMCY-Q), AurionGold’s major shareholder.