Cbh calls trading halt pending transaction

KATE EMERY, STUART McKINNON and AAPThe West Australian CBH Resources is in trading halt after last night confirming it was in confidential talks with a number of parties regarding

unspecified transactions. Takeover speculation yesterday sent the stock 26 per cent higher to 14.5 cents. The rise, which followed strong gains earlier in the week, prompted a query from the

ASX. In response CBH said it was "in confidential discussions with a number of separate parties with respect to transactions which are focused on generating shareholder value".

The miner said the discussions were incomplete and insufficiently definite to warrant disclosure. Market speculation suggests the miner could be on the verge of signing a key deal with rival

Perilya. The Chinese-controlled group is known to be looking at acquisitions both in and out of the base metals sector. Yesterday, Patersons resources analyst Alex Passmore said he expected

CBH to announce that it will jointly process ore from deposits in Broken Hill with Perilya. Mr Passmore said he did not believe CBH and Perilya were going to announce a merger. Other

speculation centred on London-based lead and zinc producer Nyrstar making a play for CBH. Nyrstar has been on the look-out for mining assets since new chief executive Roland Junck took the

reins last year, but a company spokeswoman did not wish to comment on whether it was eyeing CBH. “We saw that speculation as well, but it is just speculation,” she said. She said because of

Mr Junck's strategy of actively pursuing mining activities, Nyrstar had been linked to various potential takeover targets. In September, Nyrstar moved to take a 19.9 per cent stake in

Ironbark Gold and signed a life-of-mine offtake agreement covering its Citronen lead-zinc deposit in Greenland. CBH is in the process of doubling output at its Endeavor zinc-lead mine in New

South Wales from 28,600 tonnes of zinc and 15,800 tonnes of lead, as well as advancing Rasp. It is also active in WA, where scoping studies over its Panorama copper-zinc prospect in the

Pilbara recently confirmed it would be economically viable as a high-grade underground mine. CBH is looking for a partner to help it develop Panorama, on which it has put a $150 million

capital cost. CBH last traded at 14.5 cents, while Perilya, which has not entered a trading halt, closed down 1.5 cents at 68 cents. GET THE LATEST NEWS FROM THEWEST.COM.AU IN YOUR INBOX.

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