Bannerman flies the flag

Sundance yesterday requested a trading halt to provide the market with an update on the 50c-a-share offer that the junior had previously rejected as too low.


The Perth-based company could not comment yesterday on market speculation that the offer had been increased to 57c a share.


But a new bid is expected to be revealed today and Sundance is tipped to recommend the offer to shareholders.


News of a revised offer came as Hanlong chairman Liu Han told a local Chinese newspaper on Friday about detailed plans for Sundance's flagship African iron ore project.


According to Hanlong, it had signed a deal with an unnamed Chinese construction company to build the rail and port infrastructure for Sundance's Mbalam project, which it said would produce iron ore at a "very competitive" $US21 a tonne.






"After the successful purchase, this will have a huge impact on Chinese mining and have huge impact on Chinese iron markets," Hanlong chairman Liu Han was quoted in the Chengdu Daily as saying.


The newspaper is printed in Chengdu, capital city of the Sichuan province, where Hanlong has its headquarters.


Senior executives at Hanlong are being investigated by the Australian Securities & Investments Commission for alleged insider trading activities in relation to the Sundance bid and a move on Bannerman Resources.


ASIC is investigating Hanlong Mining managing director Steven Hui Xiao, vice-president Calvin Zhu and employee Fan Zhang


for alleged insider trading.


The investigation will determine whether the trio, along with two others, used inside knowledge of Hanlong's plans to take over Sundance and fellow Perth-based miner Bannerman Resources to make almost $2 million in profits.


The move on Sundance by Hanlong is designed to try to break the effective oligopoly of Australian and Brazilian iron ore miners, which China believes is forcing record-high prices on to its critical steel sector.


Mr Liu has said previously that he has the backing of China's most powerful economics ministry, the National Reform and Development Commission, which must sanction any major overseas purchase by a Chinese company.


While the rest of the ASX crumbled around it, Perth-based uranium play Bannerman Resources watched its share price soar by almost 24 per cent yesterday, thanks largely to developments in Hanlong's takeover bid for Sundance.
Sundance went into a trading halt yesterday amid speculation that Hanlong had agreed to sweeten its offer to buy all remaining Sundance shares, with reports suggesting the offer of 50¢ a share had been improved to 57¢ a share.
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If accepted, the deal would value Sundance at $1.65 billion and give Hanlong control of a $4.7 billion iron ore project.
Under a scheme of arrangement proposed in July, Hanlong has offered to pay 61.2¢ for each Bannerman share.
Hanlong's due diligence on the Bannerman deal was due for completion last week, but progress has slowed since the Australian Securities and Investments Commission launched an insider trading probe into the deal.