The board of Orbis Gold (ASX:OBS) has thrown the towel after a 4 month fight with Semafo (SMF.TO) which announced it planned to buy Orbis Gold at A$0.65/share in October of last year. That offer was rebuffed by the Orbis board but now both companies have agreed on a sweetened bid consisting of A$0.713 per share in cash (approximately 10% higher than the first offer).
As no white knight has emerged in the past four months we don’t think a third party will make a counter-offer and this pretty much seems to be a done deal. Semafo has already entered into lock-up agreements for in excess of 60% of the outstanding shares of Orbis, and we are expecting the transaction to be finalized within the next few months.
We first discussed Orbis Gold when its share price was trading at A$0.35, so the revised offer is almost 104% higher than Orbis’ price 16 months ago. We would now recommend to accept Semafo’s offer and reinvest the cash elsewhere.
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Disclosure: The author holds no position in any of the companies mentioned. Please see our disclaimer for current positions.
