- London to lose a major copper miner after chairman and major shareholder succeed in £2.5bn buyout move
- 850p offer sees acceptances climb over 75 per cent threshold
Kaz Minerals (KAZ) will go private after the third buyout offer was enough to gain over 75 per cent shareholder support.
The copper miner’s chair and largest single shareholder launched the bid under the Nova Resources banner in October, before a far stronger copper price made their initial 640p cash offer look set for failure.
Vladimir Kim, the major shareholder, and Oleg Novachuk, hold a combined 39 per cent of the company and received acceptances representing a further 50 per cent of Kaz’s issued shares, following the increased offer of 850p plus a 27¢ (19.5p) dividend, made during the final week of March.
"Mr Kim and I are pleased with the level of acceptances the final increased offer has received, which represents a strong endorsement from the market of our commitment to offer KAZ Minerals shareholders the opportunity to realise an attractive valuation for their shares,” Novachuk said.
The chairman told Investors’ Chronicle last month the company’s decision to build the Baimskaya copper mine in Russia meant it was not right for the London market.
“If you believe in the price, you buy copper, and you sit and wait until 2030 and you will get your gain,” he said, adding there was “huge execution risk” involved in building Baimskaya. Chinese demand and supply issues have seen copper climb to over $9,000 (£6,557) a tonne this year, a 10-year high.
The final offer included shareholders receiving a final 2020 dividend, raising questions about the board proposing a payout that helped its chairman’s attempt to buy out the company. Novachuk said he was not involved in the dividend discussions.
The ex-dividend date for this 19p payout is 13 April, and it will be paid on 23 April.
Now the 75 per cent threshold for acceptances has been hit, Kaz will be delisted from the London Stock Exchange. Kim and Novachuk’s company Nova Resources said this would happen on 11 May.
The remaining 18 per cent of shareholders that have not accepted the 850p offer can still take the cash or hold onto a stake in the private company.
Kaz’s board committee that vetted the final offer recommended any remaining shareholders accept the offer “in light of the risks of becoming a minority shareholder in a majority-controlled, private company”. We agree. Accept.
