Baker Steel Capital Managers has informed Auzex it intends to reject the offer for 7 GGG shares for every 5 Auzex shares.
Baker Steel is instead urging both Auzex and GGG to work towards a friendly merger of the consolidation of the Bullabulling Gold Project in WA, which they both own in a 50/50 joint venture.
Baker Steel on behalf of its clients is the largest shareholder in both Auzex - with a 9.3% stake - and GGG, with a 10.2% holding.
Auzex first recommended earlier this month that shareholders reject the offer, stating that the proposal is an unacceptable solution for the project and carries unnecessary risks.
Today, the company sent out a target's statement to that effect. This statement called the GGG offer “grossly inadequate,” as it was 40% below independent experts' estimates of the valuation of AZX shares.
The statement added that “key management” of Auzex - including team leader and director Greg Partington - have "no confidence in GGG.”
AZX shares fell 3.03% in Thursday's trading to $0.640. GGB shares commenced public trading today at $0.410.