Cardinal up 28% on sweetened Nord Gold bid

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Cardinal Resources Ltd. [CDV-TSX, CRDNF-OTC] shares rallied Wednesday September 2 on news that United Kingdom-based Nord Gold SE [NORD-LSE] has raised its takeover offer for Cardinal from A$0.66 to A$0.90 per share.

Cardinal said that while the revised takeover bid from Nord Gold is higher than a previous offer from Shandong Gold Mining (HongKong) Co. Ltd., it is advising shareholders to “take no action” at this time in relation to the Nord Gold takeover bid. A 48%-owned affiliate of China-controlled Shandong Gold Group Co. Ltd., Shandong has offered to acquire all the shares of Cardinal it doesn’t currently own for A$0.70 a share.

Cardinal noted that it has obligations under the bid implementation agreement with Shandong Gold, which contains matching rights in favour of Shandong. Cardinal also said it will provide updates to shareholders as soon as it is able.

Meanwhile, Cardinal shares jumped 28.5% or 19 cents to 88 cents on volume of 2.67 million. The shares were previously trading in a 52-week range of 72 cents and 20 cents.

Nord Gold is based in the United Kingdom and has a pipeline of exploration and development projects in Russia, West Africa and Kazakhstan. Its controlling shareholders are Russian billionaire Alexey Mordashov, and his sons Kirill and Nikita. Together they control 99.94% of the company.

Cardinal’s flagship asset is the Namdini gold project in Ghana, West Africa. It contains a published ore reserve of 5.1 million ounces, including a proven reserve of 400,000 ounces and a probable reserve of 4.7 million ounces (131.2 million tonnes at 1.12 g/t gold at a 0.5 g/t cut-off).

A preliminary feasibility study confirms that Namdini is one of Ghana and Africa’s most promising undeveloped large gold assets, the company said. “The financial modelling of the project shows it to be technically sound and financially viable and could generate US$1.4 billion free cash flow (pre-tax) utilizing the 9.5 million tonnes per annum model,” the company said.


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