Shares in Afferro, the West Africa-focused miner, rise 17 percent in early trade as it says investment group IMIC is preparing a bid for the iron ore group worth a potential 147 million pounds ($224.78 million).
The AIM-listed stock has slumped this year and was down 42.7 percent for 2013 before news of the bid was announced.
Tough markets have created financing restrictions for companies like Afferro, who need to overcome West Africa's dire lack of roads, rail lines and ports - troubles compounded by a weaker iron ore price.
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$1 = 0.6540 British pounds Reporting by Stephen Eisenhammer