Vancouver-based Petaquilla said the new Inmet bid "continues to fail to provide adequate value for Petaquilla shares."
"We continue to explore strategic alternatives to enhance the value of our company, including engaging in discussions with third parties regarding a potential transaction and proceeding with the ongoing marketing process for our previously announced high-yield note offering," Petaquilla said in a statement issued Monday.
Inmet said last Wednesday it was increasing its bid to 0.0118 of a common share of Inmet and 0.001 of a cent for each Petaquilla share. Alternatively, it was offering up to 60 cents in cash or a combination of cash and shares.
"The increased offer consideration represents a substantial increase of approximately 25 per cent over Inmet's original offer," it said.
And, based on the closing price of Inmet common shares on Oct. 24, the offer represents a 71 per cent premium to the closing price of 35 cents per Petaquilla share on Sept. 5, the last trading day prior to Inmet's original announcement that it would make a bid for the company.
However, Petaquilla said its board, "after careful consideration with the assistance of its independent financial and legal advisers, voted unanimously to reject the revised hostile offer and has asked shareholders not to tender to it.
"Our board will evaluate all reasonable alternatives before determining the path forward to ensure that the value of Petaquilla is maximized."
Inmet's offer is seen as a move to consolidate the area around its Cobre Panama project. Petaquilla's Molejon project neighbours Inmet's US$6.2-billion Cobre Panama copper-gold porphyry project, Panama's largest-ever mine development.
Inmet has said that Petaquilla was incorrectly suggesting that Inmet required Petaquilla's agreement to develop Cobre Panama. Petaquilla insists that certain aspects of the Inmet project do require its approval.
Toronto-based Inmet is a global mining company with wholly owned mining operations in Turkey, Spain and Finland as well as an 80 per cent interest in the Cobre Panama project under development in Panama.