SHARES in Sundance Resources are expected come under downwards pressure when they resume trading, as the prospect of a takeover deal with Hanlong Mining appears even more remote.
Sundance shares were placed in a trading halt on Monday, just before the company said Hanlong wanted to delay the takeover deal because it could not secure funding by December 13.
Sundance is expected to resume trading on the Australian Securities Exchange on Wednesday, and last traded at 39 cents.
This compares with the prospective 46 cents a share bid by Hanlong, which would value Sundance at around $1.3 billion, which itself had been revised down by the Chinese suitor from 57 cents a share earlier in the year amid falling world iron ore prices.
Hanlong already owns about 17 per cent of Sundance and wants the iron ore explorer for its $4.7 billion Mbalam mine in West Africa that straddles the border between the republics of Congo and Cameroon in West Africa.
Sundance is dependent on a larger partner, such as Hanlong, to provide funding for the project.
Sundance said on Monday it did not agree to Hanlong's most recent proposal to delay the takeover deal.
The latest development raises the prospect among some investors that the deal may not go ahead, and comes a month after Sundance reported that Hanlong had secured $US438 million ($A425.39 million) from the China Development Bank to fund the acquisition of Sundance.
"Sundance will consider its position when it has adequate information and will further update the market when it is in a position to do so," Sundance said in a statement on Monday.
The company said the trading halt would be lifted on Wednesday and it would seek further particulars from Hanlong about its timetable for the bid.
Analysts have questioned the viability of the Mbalam project because of its remote location and given recent iron ore price volatility amid a slowing world economy.
CMC Markets analyst Michael McCarthy said Hanlong had pulled its bid too many times.
"What a disaster," Mr McCarthy said.
"If you ever wanted to come up with a difficult takeover bid to do, this would be it."
The market had persistently priced the stock below its takeover price, so there were persistent doubts about the viability of the deal.
"There is something quite wrong here and my sense is this deal will not go ahead."
The Mbalam project, which includes building a 510km rail line and a deepwater port, is expected to produce 35 million tonnes a year of iron ore.
This compares with a forecast 55 million tonnes this year from Australia's Fortescue Metals Group, the world's number four iron producer.
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