Kenmare Resources’s former managing director Michael Carvill and an Abu Dhabi private equity firm have been given a further four weeks to at least announce a firm intention to make a bid for the titanium minerals miner.
The Irish Takeover Panel had originally set a deadline of 5pm on Thursday for the duo to make a move, after their initial indicative offer of £5.30 per share – or £473 million (€547 million) in total – was rejected by the company, which Mr Carvill founded in 1986 and led until his exit last August.
“In order to facilitate ongoing discussions with the consortium and to provide additional time for the consortium to progress its due diligence, the board has requested, and the Takeover Panel has consented to, an extension of the current deadline,” Kenmare said in a statement.
The consortium is now required by no later than close of business on May 15th, the day when Kenmare is also due to hold its annual general meeting (agm).
Kenmare also issued a production update on Thursday, saying that it experienced stable market conditions in the first quarter of this year, with encouraging demand for its key product, ilmenite, which is used in the manufacture of everything from paints and plastics to ceramics and textiles.
Although demand remained healthy, the market continued to be modestly oversupplied due to new supply from concentrates producers entering the market, it said. This continued to negatively impact average received prices, however prices “now look to be stabilising”, it added.
This follows two years of falling ilmenite prices.
“Ilmenite production in the first quarter was in line with our expectations and we anticipate that production will increase from the second quarter onwards as the southern hemisphere rainy season has now concluded,” said managing director Tom Hickey.
The company is currently working on an upgrade of its main mining plant and relocating it within the Moma site, a project the is expected to cost $341 million (€300 million) by 2027 but is forecast to secure production for decades to come. Mr Hickey said that the upgrade product “is progressing well”.
Meanwhile, Kenmare said that it remains in discussions with the Government of Mozambique on an extension of a production royalty agreement – or what is called an implementation agreement. “Kenmare’s existing rights and benefits remain in full force and effect pending conclusion of the extension process,” it added.
