A2MP Investments, which owns 55.56% of Canyon Resources, has launched a bid to acquire the rest of the Australian mining company, take it private, and reassess the scale of the Minim-Martap bauxite project in Cameroon, arguing that the project’s current assumptions may no longer support a profitable operation.
Canyon confirmed it received the unsolicited and conditional takeover offer, which covers all shares not already owned by A2MP. The bidder’s statement was published on July 29 on the Australian Securities Exchange (ASX).
The off-market offer values minority shares at AUD0.05 each, a 42.5% discount to Canyon’s closing price of AUD0.087 on July 28, the day before the bid was filed.
The transaction values Canyon’s equity at about AUD103 million. Including the net debt cited by A2MP, the company’s enterprise value would reach about AUD188 million.
A2MP expects to spend up to AUD45.82 million to acquire the outstanding minority shares. The cost could rise to AUD46.57 million if all outstanding options are exercised. The company said it has about $127 million in cash available to fund the acquisition.
The offer is conditional on A2MP securing at least 75% ownership. If its stake exceeds 90%, it intends to compulsorily acquire the remaining shares and delist Canyon from the ASX. Even if ownership remains below 90% but above 75%, the company could still seek a delisting, subject to Australian exchange rules. The offer document filed on July 29 did not specify opening or closing dates for the bid.
Lower premium, higher freight costs
Behind the takeover bid is a broader challenge to the economic assumptions underpinning Canyon’s definitive feasibility study for Minim-Martap, published in September 2025.
That study estimated the project’s pre-tax net present value at $835 million and its pre-tax internal rate of return at 29%. It assumed an average premium of about $11 per ton of bauxite because of the ore’s high alumina content and low silica levels.
A2MP now argues that a premium closer to $5 per dry ton better reflects current market conditions. The company said the estimate is based on six months of commercial discussions with potential buyers. At the same time, it estimates initial freight costs at $32-$36 per ton, compared with the $17 per ton assumed in Canyon’s feasibility study.
Combined, those two revisions would reduce the project’s economics by $21-$25 per ton compared with Canyon’s assumptions, reflecting roughly $6 less in premium and $15-$19 more in freight costs.
However, A2MP has not produced a revised feasibility study. It has not recalculated the project’s overall costs, production volumes, selling prices, or capital expenditures. The majority shareholder also argues that insurance, export duties, sampling costs, fuel expenses, and some logistics investments may have been underestimated.
“The project may no longer be viable in its current form and with the financing currently available,” A2MP said. That assessment contrasts with Canyon’s feasibility study, which estimated total capital expenditures at $446 million, including $348 million for rail infrastructure. At the time, Canyon said it had reasonable grounds to pursue financing for the project, although it had not yet secured all of the required funding.
A smaller mine under consideration
A2MP is not only challenging the project’s financial assumptions. It is also openly considering a smaller operation than the one outlined in Canyon’s development plan.
If the takeover succeeds, the company plans to review Canyon’s strategy, financial position, assets, and operations to determine whether Minim-Martap can achieve profitable commercial production under the price and volume assumptions used to date.
“The Minim-Martap project may not be profitable at the prices and production volumes currently proposed,” A2MP said. If that conclusion is supported by independent advisers, the company said it could abandon plans to develop the mine to the production levels currently envisioned. Some mining activities would continue, but the project’s design, scale, and timeline would be redefined.
A2MP also said delisting Canyon would eliminate the costs associated with maintaining its ASX listing and allow the company to integrate the project more closely into its broader African mining strategy.
The group said it aims to build a value chain in Cameroon spanning bauxite mining, alumina refining, and aluminum production. However, it did not provide details on planned processing capacity, investment costs, or implementation timelines.
First shipment delayed until the fourth quarter
The reassessment comes as the Minim-Martap timetable has already slipped. The first bauxite shipment, initially expected in the first half of 2026, is now scheduled for the fourth quarter.
As recently as June 26, Canyon said the seven locomotives planned for the project’s first phase had been delivered. Together with 160 railcars, they are expected to transport about 35,000 wet metric tons of ore per month.
To increase capacity to 105,000 metric tons per month by the third quarter of 2027, the company estimates it will need an additional $160 million. The funding would finance 15 more locomotives, 400 additional railcars, and upgrades to the rail network.
Without that financing, monthly transport capacity would remain limited to about 35,000 metric tons. At a constant operating pace, that would amount to roughly 420,000 metric tons per year, excluding interruptions, ramp-up periods, or operational constraints.
That level remains well below the initial production target of 1.2 million metric tons per year outlined in the feasibility study.
For Cameroon, a smaller project would alter expectations for mining revenue, rail traffic, and port activity linked to Minim-Martap. However, that scenario does not yet represent a final investment decision. It reflects the case A2MP is making to support its takeover bid and the discount offered to minority shareholders.
Canyon urges shareholders to wait
Canyon Resources has not yet responded to A2MP’s criticism of the project’s economic assumptions.
In its July 29 statement, the company said its board is reviewing the bidder’s statement and preparing its formal recommendation. It urged shareholders not to take any action on the offer or the documents sent by A2MP until Canyon publishes its Target’s Statement, which will present the board’s official position.
That response will also include an independent expert’s opinion on whether the proposed offer price is fair and reasonable. Canyon’s reply will therefore need to address more than the value of its shares. It will also have to persuade investors that the assumptions underpinning its September 2025 feasibility study remain valid despite higher freight costs, lower expected marketing premiums, and additional financing needs.
The bid has set the stage for a contest between two competing visions for Minim-Martap: Canyon’s plan to gradually build a multi-million-ton operation and A2MP’s proposal for a smaller project, operated as a private company and integrated into its broader African mining strategy.
Baudouin Enama
