CDV - Cardinal Resources

On the basis that Shandong stated its $1 per share October offer was “best and final in the absence of a higher competing offer”, Russia’s Nordgold matched the $1 per share offer. The rival Chinese and Russian groups already held 11.9 per cent and 27.8 per cent of Cardinal respectively.
However, Cardinal Resources’ shareholders were unhappy the miner was unable to create any competitive tension in the bidding process given Shandong had labelled its $1 offer “best and final” in the absence of better offers.

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Cardinal applied to the Takeovers Panel to effectively relieve Shandong from its “best and final” position on the basis the auction had reached an impasse, but on November 17 the panel [ ] rejected the application on the basis that bidders must be held to the principle of “truth”. In other words, no bluffing – if you say something is your last and best bid at an auction, you must be held to it.

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This is when an under-the-radar Ghanaian mining company named Engineers and Planners rode, deus ex machina, to the rescue for Cardinal with a dramatic $1.05 per share November 24 takeover bid.

Cardinal argues the third-party bid from the Ghanaians releases the Russian and Chinese bidders from their binds not to increase their bids.

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Thrown an escape rope, Shandong increased its bid to $1.05 per share, with Cardinal’s board urging shareholders to accept the Ghanaian-matching bid from its favoured Chinese suitor.
Cardinal also appealed to a Takeovers Review Panel to accept the legitimacy of the latest proceedings, but on 10 December the review panel appears to have upheld the original verdict that bidders are bound by “final bids”, while suggesting the third-party bid released the bidders from their obligations.

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