SouthernEra Diamonds (SDM-T, SRE-L) says it is in negotiations with possible white-knight bidders to thwart a bid from London-listed Mwana Africa (MWA-L) to take over the company.
Mwana announced on March 16 that it would launch a bid for SouthernEra, offering one Mwana share for 2.3333 SouthernEra. The bid at that time valued SouthernEra at $69.7 million.
On May 8, Mwana said that BHP Billiton (BHP-N, BLT-L, BHP-A) had agreed to a lockup of its 9% shareholding in SouthernEra. SouthernEra has a right of first refusal that would allow it to buy back the shares at 43, or about $6.7 million. It would have to notify BHP that it intended to exercise the right by May 22.
Since then, Mwana has arranged extensions to the existing lockup agreements with SouthernEra shareholders, and has agreements covering just under 40% of SouthernEra stock up to the end of June.
SouthernEra said it was monitoring developments, and that it “continues to explore strategic alternatives” to the deal.
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