The company said Ichor’s proposed offer represents a low valuation multiple based on Universal’s existing production, and ignores the value of its near term production and longer term development pipeline.

“It remains an indicative offer not capable of acceptance, with no guarantee that a formal offer will be made to shareholders; it is highly conditional; it is at a discount to Ichor’s own entry price; and it is opportunistically timed,” the company said.

The takeover is of significant strategic importance to Ichor and highly accretive to its shareholders, at the expense of Universal’s shareholders, Universal said.

Universal non-executive chairman John Hopkins said: “After careful consideration, the sub-committee is unanimous that Ichor's proposed Offer does not reflect the inherent value of Universal Coal. The Offer is also highly conditional and lacking certainty of completion.

“Ichor appears to have understated production figures from the Kangala Colliery, which is already highly cash flow generative.

In addition, the Offer does not adequately value the material earnings impact that the Company's next operation, NCC, is expected to deliver when it comes on stream later this year.”

Universal has engaged KPMG Financial Advisory Services to prepare an independent expert's report and assess whether the offer is fair and reasonable.