Small-cap mineral and gold explorer, Sihayo Gold (ASX:SIH) shares have surged on news that the company has received notification from Provident Aurum Pte of an off-market takeover offer to acquire all shares of Sihayo Gold.
Under the Offer, Sihayo shareholders will be offered an all-cash payment of 0.225 cents for each Sihayo share they hold.
Provident Aurum is a subsidiary wholly owned by Provident Minerals Pte, specifically established to make the takeover offer for Sihayo. Having been the sole shareholder since 2013, it already holds 40.16% of the voting power in Sihayo.
If Sihayo were to reject the offer, Provident Aurum director Mr. Hari Gurung has made intentions clear.
“In the event the Offer is unsuccessful then Provident Aurum will undertake a review of its Sihayo investment and may explore the possibility of divesting its Sihayo Shares via a market selldown process or other means and may withdraw its involvement in Sihayo including discontinuation of financial support.”
“Despite multiple capital raisings over many years, Sihayo has still not been able to advance the Sihayo Gold Project to development phase.”
“Although Provident Aurum does not intend to develop the Project in the near term, if it is able to secure control of Sihayo…. to try and accelerate the Project’s development, Provident Aurum intends to allocate more resources to the Project… leading to more capital raisings and Sihayo Shareholders would need to participate in any equity raisings to avoid being diluted.” Mr. Hari Gurung reitterated.
The offer is contingent on Provident Aurum acquiring a relevant interest in more than 50% of Sihayo shares.
SIH is up 100%, last traded at 0.2 cents, at 12pm AEST.