The West

Bullabulling rejects Norton offer

Bullabulling Gold shares drifted higher yesterday after the com- pany rejected a hostile 7c-a-share offer from Norton Gold Fields but still closed the day at only half the value assigned to its stock in an independent expert report prepared for the company.

Tensions between the parties ramped up yesterday as Bullabulling released its target statement in the morning, which contained the expert report.

That was quickly followed by the release of a statement by the Takeovers Panel confirming China-backed Norton had lodged a complaint about Bullabulling's previous commentary on the offer, and that an April 24 meeting notice sent to Bullabulling shareholders failed to mention Norton's April 17 takeover offer.

In a response that surprised no one, Bullabulling's board rejected the "inadequate and opportunistic" Norton offer, pointing to a BDO Corporate Finance report that described the bid as neither fair nor reasonable. It was based on an assessment its namesake gold project carried an implied asset value of between $34 million and $51 million - 11.1c to 16.1c a share - based mainly on other transactions involving non-operating WA gold assets since 2010.

But the BDO report also noted the 7c Norton offer was within the boundaries of comparable transactions - albeit at the low end - when a "quoted market price" valuation methodology was used and a control premium was added to Bullabulling's recent trading price.

Norton will need to wait for a decision on whether its complaints will be considered for further action.

Bullabulling shares closed up 0.3c yesterday to 7.3c.

The West Australian

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