Vancouver – Looking to consolidate ownership in the high-grade Akie zinc-lead project in northeastern British Columbia, Mantle Resources (MTS-V, MTSZF-O) plans a takeover bid to acquire Ecstall Mining (EAM-V, ESMGF-O).
The all-share bid sees Mantle offering 0.4 of a share for each Ecstall share. The offer (working out to around 47 per share) represents about a 50% premium over the December 15th share price based on Mantle’s and Ecstall’s $1.18 and $0.315 closing prices respectively.
Mantle president Peeyush Varshney described the proposed combination as “in the best interests of shareholders of both companies.”
“We invited the directors and management of Ecstall to sit down and discuss our proposal for a friendly combination of the properties and the complimentary resources and management of both companies, however Chris Graf, the president of Ecstall, refused to make himself available to talk to us”, added Varshney in a prepared statement. “We believe our offer makes good business sense. If, however, Mr. Graf is unwilling to listen, we really have no choice but to take our offer directly to Ecstall’s owners, which is what we will now do.”
As of presstime, Ecstall has not commented on the offer nor could its president be reached for a statement.
Since commencing its drill program in late-2005, Mantle has turned in a number of significant, high-grade zinc intercepts at Akie. It is earning up to 65% interest from Ecstall which currently holds 40% interest and has an option-to-purchase agreement from Inmet Mining (IMN-T, IEMMF-O) to acquire the remaining 60% for $475,000. Mantle will vest its interest for cash payments of $450,000 and expenditures of $4 million. There are no royalties on the project.
Some of the recent results significantly exceed historic values encountered by past project operator Inmet. In 1995, the major calculated a non-NI43-101 compliant inferred resource (based on only four widely spaced holes) of 13 million tonnes grading 8.5% zinc, 1.5% lead and 13.2 grams silver, over an average true thickness of 6.3 metres. The resource sits within a large, plus-50 million tonne body of massive sphalerite-galena-pyrite-barite mineralization.
Akie is a sedex zinc-lead deposit situated in the southern Kechika Trough. Mineralization is hosted in Gunsteel Formation shales with a sheet-like body of laminated to massive pyrite and barite, containing local finely laminated bands of sphalerite and galena.
The project recently caught the interest of zinc-producer Lundin Mining (LUN-T, LMC-X) that invested $2.87 million into Mantle, acquiring an almost 10% interest in the company.
Shares of Mantle shed three pennies on the takeover announcement to close $1.15 apiece while Ecstall gained about a dime to close at 41 per share.
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