Mysterious ‘China Gold Stone’ makes and withdraws Allied Nevada bid within 12 hrs
Allied Nevada has contacted the SEC and the Ontario Securities Commission with its concerns regarding the existence of the China Gold Stone Mining Development Ltd., allegedly registered in Hong Kong.
Posted: Wednesday , 15 Jan 2014
RENO (MINEWEB) -
Ever heard of China Gold Stone Mining Development Ltd.?
Neither had Mineweb.com until a press release went out on Tuesday morning stating “China Gold Stone Mining Development Limited announced today that they have commenced a cash tender offer…for all of the outstanding shares of common stocks, and related stock purchase rights, of Allied Nevada Gold Corp…”
“Tendering shareholders will be paid $7.50 per share in cash. The Tender Offer and Consent Solicitation will expire at midnight…on January 24, 2014, unless extended or earlier terminated (the Expiration Time”).
The dateline of the news release published on PRNewswire Tuesday morning came from Reno, but a search of the Nevada Secretary of State business incorporation records show no entity named “China Gold Stone Mining Development” or “China Gold Stone” exists within the state. Even the Reno phonebook showed no listing of the company.
Yet, several major business and mining news organizations jumped on the announcement and Allied Nevada's stock rose as a result.
But, while Allied Nevada, which operates the Hycroft gold mine near Winnemucca, Nevada, said it received a letter from China Gold Stone on Jan. 13, 2014 that included such a proposal, it stressed: "for a number of reasons the company seriously questions the credibility of the proposal and advises shareholders to review announcements from China Gold Stone with caution.”
“Together with its advisors, Allied Nevada has not been able to find any substantive published information on China Gold Stone and cannot substantiate the credibility of the proposal,” Allied Nevada said in a news release. “There is no public information available to indicate that China Gold Stone has the resources to complete the proposed transactions.”
The Nevada gold miner stressed that, “contrary to the announcement, No Tender Offer has Been Commenced.”
“Allied Nevada has contacted the SEC and the Ontario Securities Commission with its concerns about the validity and legality of the announcement and alleged proposal.” Mineweb’s call to Allied Nevada CEO Randy Buffington had not been returned as of deadline early Wednesday morning.
By 12:34 p.m. Eastern Time Tuesday, China Gold Stone issued a terse withdrawal: “CHINA GOLD STONE MINING RETRACTS PRESS RELEASE ISSUED IN ERROR THIS MORNING -- China Gold Stone Mining Development Limited announced that the press release issued by it earlier today regarding a bid for Allied Nevada Gold Corp. was issued in error and without the advice of counsel. The earlier release has been retracted.”
Allied Nevada shares closed at $4.62 in New York after the resumption of trading Tuesday.