Crocodile Gold receives buyout offer, shares jump

Wed Dec 14, 2011 5:47pm EST
 
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(Reuters) - Crocodile Gold CRK.TO received an unsolicited offer from Luxor Capital Group to buy a majority stake in the Canadian miner for about C$121 million, and said it has set up a special committee to review the bid.

The special committee will consider all possible alternatives, including potential rival offers, Crocodile Gold said in a statement.

New York-based private equity firm Luxor had on Tuesday offered to buy upto 215.4 million shares, or about 69 percent, of Crocodile Gold at 56 Canadian apiece -- 64 percent higher than the stock's Monday closing.

Toronto-based Crocodile shares have been hit this year as the miner grappled with lower-quality grades and delays at its mines. They closed up 42 percent at 48.5 Canadian cents on Wednesday on the Toronto Stock Exchange.

Crocodile Gold, which owns and operates mines in the northern territory of Australia, has not reported a profit since the fourth quarter of last year and had last month said it will cut its production forecast for the next year.

(Reporting by Maneesha Tiwari in Bangalore; Editing by Supriya Kurane, Viraj Nair)