Xanadu Mines Bags Backer in Bastion Bid: A$0.08 Cash Offer Aims to Unlock Mongolian Copper-Gold Potential

In a move that has caught the attention of copper bulls and cash-hungry juniors alike, Xanadu Mines (ASX:XAM, TSX:XAM) has announced a recommended off-market takeover offer from Bastion Mining Pte Ltd, at A$0.08 per share. The offer lands with a 57% premium to Xanadu’s last close of A$0.051 and assigns the explorer an implied equity value of A$160 million—excluding a separate capital injection as part of the same deal.

The bidder, Bastion, is backed by Boroo Pte Ltd—a Singaporean outfit with operational chops courtesy of the Lagunas Norte gold mine in Peru—and current Xanadu director Ganbayar Lkhagvasuren. The duo’s interest in Mongolia’s copper-gold riches is nothing new, but this formal offer crystallises their intentions to shift the Kharmagtai project into a more development-focused phase.

“This offer aligns with our strategy to deliver shareholder value and marks a significant liquidity event,” said Xanadu’s Executive Chairman Colin Moorhead, noting the company’s “considerable achievements” in progressing its flagship Kharmagtai project.

From the bidder’s corner, Lkhagvasuren stressed the importance of certainty: “Against a backdrop of considerable market uncertainty, our offer gives Xanadu shareholders cash in hand at a material premium.”

Sweetener Up Front

Before the takeover bid formally kicks off, Bastion will tip in A$17.2 million via a share placement at A$0.06 per share. That cash is earmarked for Xanadu’s working capital and its obligations under the Kharmagtai joint venture. Upon settlement—slated for 26 May—Bastion will emerge with a 13.04% stake.

The offer will become unconditional once Bastion crosses the 50.1% threshold. Given the boardroom alignment and shareholder support already on display, this milestone appears within reach.

Xanadu’s independent takeover committee—comprising all directors except Lkhagvasuren and Zijin Mining’s representative—has unanimously recommended the offer, contingent on no superior proposal and a favourable ruling from the Independent Expert. Importantly, the company’s largest independent shareholder, CAAF Ltd (11.85% stake), has also indicated its intent to accept under similar conditions.

Premiums and Protections

The A$0.08 offer price stacks up well across the board:

• 57% premium to the last traded price

• 62% premium to the 10-day VWAP

• 46% premium to the 30-day VWAP

• 52% premium to the 90-day VWAP

It’s not just the price doing the heavy lifting. Xanadu shareholders are also getting deal certainty via a tightly drafted Bid Implementation Agreement (BIA), peppered with familiar exclusivity features: ‘no shop’, ‘no talk’, and a matching right in case of a rival bid. There are break fees in place to discourage cold feet on either side.

Notably, the company has committed to withdrawing a previously scheduled shareholder vote on whether to exercise a put option requiring joint venture partner Jinping to acquire a 25% stake in Khuiten Metals. The withdrawal reflects the confidence the board now has in Bastion’s proposal and the funding relief it brings.

The Road Ahead

Assuming the equity subscription goes through on schedule, the formal offer documents (Bidder’s and Target’s Statements) are expected to be dispatched around 28 May, kicking off the official offer period. The minimum duration will be one month, though extensions remain on the table.

As of now, no action is required from shareholders, but the pitch from the board is clear: take the cash, absent a better offer.

With copper still enjoying long-term thematic tailwinds and Kharmagtai increasingly seen as a strategic tier-one asset, the play from Bastion could be savvy timing—or a savvy snatch—depending on how the market re-rates copper juniors in the next cycle.

Either way, for Xanadu’s long-term investors, it’s decision time—stick with the Mongolian dream or pocket a premium and move on.