Ten days ago, Canadian gold miner Alamos Gold publicly made an offer to buy rival miner Aurizon Mines (UNKNOWN:AZK.DL2) for C$4.73 a share, a 40% premium over Aurizon's then-current price. This morning, Aurizon gave its response: Not enough.
In a unanimous decision, Aurizon says, its board of directors has voted to reject Alamos' offer -- or, more specifically, to recommend that its shareholders reject the offer. Aurizon is going one step further, and has voted to adopt a "shareholder rights plan," more commonly known as a "poison pill," which aims to make a takeover by Alamos without the board's approval prohibitively expensive.
In a statement, Aurizon took pains to argue that its shareholder rights plan is in fact "not intended to prevent a takeover of Aurizon or to secure continuance in office of management or the directors," but rather to "provide the Board with adequate time to identify, develop and negotiate value-enhancing alternatives, if appropriate, to any unsolicited take-over bid, including the Alamos Offer and to encourage equal treatment of shareholders in connection with any take-over bid offer." The board termed Alamos' offer "financially inadequate and opportunistic."
Fool contributor Rich Smith has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.