Lynas’ lost opportunity to resolve controversy
FocusM | 29 Mar 2019 00:30
Australia’s Lynas Corporation Ltd may have missed out on a big opportunity to resolve the dilemma of its Lynas Advanced Material Plant (LAMP) in Gebeng, Pahang.
On March 25, Australianlisted Wesfarmers Ltd launched an A$1.5 bil (RM4.34 bil) bid to take over Lynas at A$2.25 per share. The offer represents a 45% premium to Lynas’ closing share price that day.
The takeover bid pushed Lynas share price up sharply by 35% to A$2.10. Unfortunately, Lynas’ board declined Wesfarmers’ bid. Lynas merely said it will not engage Wesfarmers on the takeover bid after having “consulted with its advisers on the terms of the proposal and validated its view as to value.”
This is an unfortunate development and perhaps a misstep on the part of Lynas. The company has faced severe criticism from various quarters regarding its approach in managing its water leach purification (WLP) residues as a result of the rare earth refinery in LAMP.
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