Sierra Metals (TSX: SMT) has finally given up in its fight against a hostile takeover by Alpayana S.A.C. The company has reached an agreement with the private miner following a slightly increased take-over bid.
The revised takeover bid has seen the offer to Sierra Metals shareholders increased from $1.11 per share to $1.15 per share, with the purchase to be paid for in cash.
Sierra and Alpayana are to enter into a support agreement in the near term in relation to the revised bid, while the transaction in the interim has been granted unanimous support by the board of directors as well as a special committee of independent directors. Directors and officers have also agreed to entered into a lock-up agreement under which they will agree to tender their shares to support the transaction.
WATCH: Sierra Metals: The Hostile Takeover Attempt
The expiry time for the take-over bid meanwhile has been extended until May 12 at 5:00 P.M.
The acceptance by Sierra’s management team follows an ordeal that began back in December, with Alpayana initially offering $0.85 a share for Sierra Metals, prior to increasing the offer to $1.11 per share in early April. The initial offer was a premium of 26% to the then 30 day volume weighted average price of Sierra, which stood at $0.676.
Sierra Metals last traded at $1.09 on the TSX.
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