10/31/2012 07:29 EDT | Updated 12/31/2012 05:12 EST

B.C. regulators reject Petaquilla shareholder rights plan to fend off Inmet

VANCOUVER - British Columbia securities regulators have rejected a shareholder rights plan at Petaquilla Minerals Ltd. that would help it to fend off a hostile takeover offer from Inmet Mining Corp. (TSX:IMN) worth about $140 million.

The B.C. Securities Commission said Wednesday it has ordered a ban on any trading related to the plan effective after markets close on Friday.

The ban will cover "trading any securities issued, or to be issued, under, or in connection with, the Petaquilla shareholder rights plan, including, without limitation, any rights issued under that plan and any common shares of Petaquilla to be issued upon the exercise of those rights."

Petaquilla Minerals (TSX:PTQ) on Monday rejected the latest takeover bid by Inmet, which Inmet says is 25 per cent higher than the $112-million it originally offered, saying it still undervalues the company.

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.

Shares in Petaquilla rose 3.2 per cent or two cents to 64 cents in Monday trading on the Toronto Stock Exchange while Inmet stock added 13 cents to $51.50.