A hostile C$179 million takeover bid for base metals company Sierra Metals is looming as private Peruvian company Alpayana directly appeals to shareholders.Alpayana said it intends to commence a direct to shareholder all-cash takeover at a price of 85 per share, which it says is a 26% premium to the 30-day volume weighted average price over the 30 trading days ended December 13.
Alpayana is appealing directly to Sierra shareholders due to what it says is the weak financial position of the publicly-listed company, with "liabilities, a working capital shortfall, a large asset base subject to potential impairments, and outsized corporate expenses relative to total assets and revenues" which it believes will require the company to seek additional funding that could be dilutive to shareholders.