CLAYTON Utz is advising ASX-listed Central Africa-focused iron ore exploration and development company Sundance Resources Ltd as Chinese investor Sichuan Hanlong announced a $1.44 billion offer for the company.
Mallesons Stephen Jaques is acting for Sichuan Hanlong Group on the takeover bid.
Sundance said today Hanlong Mining had offered 50 cents for each Sundance share, a 25 per cent premium to the share's close on Friday. The Wall Street Journal reports that about $1.1 million in shares traded above that price today at levels put 51.5 cents, which suggests investors expect Hanlong may have to raise its offer, or that another buyer could join the fray.
Hanlong currently holds an 18.6 per cent stake in the company, which it purchased in March from the investment vehicle of Sundance's late director Ken Talbot.
Hanlong's managing director, Xiao Hui, said in a statement that he looks forward to discussing the deal further with Sundance.
Under the proposal, Hanlong Mining proposes to acquire the remaining shares in Sundance via a scheme of arrangement.
Clayton Utz Perth corporate and M&A partner Mark Paganin is the firm's lead partner on the deal, with support from Perth colleague and Corporate / M&A partner Matthew Johnson.
The Mallesons team is being led by partner David Friedlander and senior associate Paul Schroder.
The move from Hanlong suggests a shift by Chinese investment groups away from direct investment in Australia, The Wall Street Journal reports.
Deterring overseas investment have been attributed to Australia's opaque foreign investment approval process, rising cost pressures, and the introduction of new mining and carbon taxes over the past 18 months, it reports.
However, deals such as Peabody Energy Corp.'s and ArcelorMittal's joint A$4.73 billion offer for Macarthur Coal Ltd. last week suggest that takeover appetites remain strong.