Russia v China stalemate in battle for Cardinal Resources

Russia's Nordgold is digging in as its $500 million-plus battle with China for control of Perth-based Cardinal Resources reaches a near stalemate and the Takeovers Panel considers a request to intervene.

Nordgold said on Monday it would not increase its unconditional, on-market $1-a-share offer for Cardinal – which matches the offer from rival suitor Shandong Gold – unless there is a higher competing offer.

Shandong, China's second biggest gold producer, is saying the same thing about its $1-a-share offer.

Nordgold and Shandong are fighting over Cardinal's 5.1-million-ounce Namdini project in north-east Ghana, with the Cardinal board continuing its unanimous backing of the Shandong bid.

Cardinal said on Monday it had a received four letters from shareholders controlling 3.43 per cent of the stock saying they intended to accept the Shandong offer, extended to close on Friday, unless there was a higher bid.

This followed an announcement on Friday in which Cardinal said it had 28 letters from shareholders representing 19.38 per cent of the stock flagging their intention to accept the Shandong offer.

Nordgold, controlled by Russian oligarch and steel billionaire Alexey Mordashov, alleges Cardinal's announcement on Friday was "materially misleading". It has made an application to the Takeovers Panel and is seeking remedial orders.

It is the second grievance Nordgold has raised with the Takeovers Panel since last week.

On Friday, the Takeovers Panel said it had received an application from Nordgold in relation to the Cardinal takeover tussle but no decision had been made on whether to conduct proceedings.

The initial complaint centres on a statement by Shandong on October 19 stating that its $1-a-share offer was “best and final in the absence of a higher competing offer”.

Nordgold subsequently raised its bid from 90¢ a share to a $1 a share to match Shandong.

The Russian heavyweight with existing gold operations in west Africa is concerned about the wording of a Cardinal announcement on October 21 which said in part that Nordgold had "made a higher competing offer".

Nordgold has alleged to the Takeovers Panel that the Cardinal announcement and advice received by shareholders indicated that Shandong could depart from its commitment that the $1-a-share offer was “best and final in the absence of a higher competing offer”.

The Takeovers Panel said Nordgold claimed Cardinal’s conduct was "misleading and/or deceptive, or likely to mislead or deceive".

In March, Nordgold put up a 45.7¢-a-share takeover offer for Cardinal after building a 19.9 per cent stake.

State-owned Shandong responded in June with a $300 million off-market takeover offer pitched at 60¢ a share.

They have continued to bid up the price since then with Nordgold holding about 28 per cent and Shandong holding about 12 per cent of the stock.