TNR Gold’s board said the takeover bid is an “opportunistic, low-ball offer” and it is neither financially adequate nor in the best interests of the company or its shareholders
TNR Gold turns down Lithium Royalty's unsolicited and non-binding takeover offer. (Credit: ivabalk from Pixabay)
TNR Gold has rejected Lithium Royalty (LRC)’s unsolicited and non-binding offer to acquire the former for a cash consideration of C$0.08 ($0.058) per share.
According to the board of the Canada-based green energy metals royalty and gold company, the takeover bid is an “opportunistic, low-ball offer”.
The company also said that the proposal is neither financially adequate nor in the best interests of the company or its shareholders.
Lithium Royalty announced its non-binding all-cash offer to the TNR Gold’s board of directors last week.
The lithium-focused royalty company said that the proposal represented a premium of 45% to TNR Gold’s closing share price on 28 September 2023.
TNR Gold holds net smelter return (NSR) royalties of 1.5% and 0.4% on the Mariana lithium project and the Los Azules copper project, respectively.
Mariana is being developed by Ganfeng Lithium while the copper project is being developed by McEwen Mining. Both projects are located in Argentina.
Besides, TNR Gold has a 7% net profits royalty holding on the Batidero I and II properties of the Josemaria copper-gold-silver project that is being developed by Lundin Mining in Argentina.
The company said that it offers significant exposure to gold through its stake of 90% in the Shotgun gold porphyry project located in Alaska.
TNR Gold CEO and executive chairman Kirill Klip said: “We welcome this opportunity for increased attention on our fantastic company and we believe shareholders and investors will see that the current share price of TNR deeply undervalues the Company.
“Given that LRC valued only a portion of the Company at US $9 million, based on its purchase in February 2023 of the 0.5% NSR royalty involving the Mariana Lithium project in Argentina for US $9 million, the offer of CDN $15 million (approximately US $11 million) for the entire Company is considered opportunistic and inadequate.”