Decision in Relation to Ranger Minerals

Release number


The Panel advises that it has made a declaration of unacceptable circumstances in relation to statements made by Revesco Group Limited in a letter (Letter) which accompanied a supplementary bidder's statement dispatched by Revesco to Ranger Minerals Limited shareholders on 17 June 2002. Ranger applied for a declaration of unacceptable circumstances on 20 June 2002.

Revesco claimed in the letter that independent analysis had confirmed Revesco's view that Perilya Ltd.'s Broken Hill mine is cash flow negative at current A$ metal prices and could potentially exhaust Ranger's balance sheet by the end of 2003 if the merger between Ranger and Perilya proceeds.

Revesco also claimed that a number of independent resource investment analysts, and the international chartered accounting firm PKF, supported its assertion that at current metal and Australian dollar prices, the Broken Hill mine will not be profitable or cashflow positive. Revesco went on to say that PKF had independently reviewed and verified Revesco's calculations.

The Panel has decided that:

  1. the statements in the Letter referred to above are incorrect (either by fact or omission) and should not be relied upon;
  2. the analysis carried out by Revesco involved Revesco recalculating the analysis of two brokers and because Revesco did not have access to the methodology and models used by the brokers, that it was unable to make the recalculations on any reliable basis, that such recalculation as was undertaken was not applied systematically and no sensitivity analysis was performed;
  3. the conclusions reached by Revesco in relation to the Broken Hill mine are not supported by independent analysts.

The Panel has decided to order Revesco to retract the statements and correct the misleading aspects.

In order to ensure that acceptances under the Revesco bid are made in a properly informed market, the Panel has decided to order that all acceptances made after the statements be cancelled, and those Ranger shareholders be given an opportunity to accept once they are given corrected information.

The Panel has decided to order that the Revesco bid be extended by at least 14 days after Revesco issues correcting statements.

In the interim, Revesco has undertaken to the Panel not to process any acceptances (and has advised the Panel that none have been processed so far).

The sitting Panel is Peter Cameron (sitting President), Maria Manning and Les Taylor.

Nigel Morris
Director, Takeovers Panel
Level 47 Nauru House, 80 Collins Street,
Melbourne VIC 3000
Ph: +61 3 9655 3501