Bid target Celtic Resources should receive $17.5 million (£8.7 million) from selling its stake in Russia's Tominskoye copper project.

The AIM-quoted company, whose gold, copper and molybdenum projects in Kazakhstan and Russia have prompted a hostile bid from Russian tycoon Alexei Mordashev's Severstal Group, is selling its 70 per cent Tominskoye stake to part of the Russian Copper Company. Anime Global Limited (AGL), Celtic's partner in the project is receiving $7.5 million for its 30 per cent share.

Both Celtic and AGL stand to receive between them $19.03 for each tonne by which the Tominskoye deposit is found to exceed 1.3 million tonnes. Celtic's managing director Kevin Foo says the sale brings the cash raised by the company to $44 million from selling assets acquired through its Eureka arm, which cost some $32 million. He adds that the company will be focusing on producing assets at Suzdal and Zherek in Kazakhstan and its 'highly attractive' Shorskoye mine in Russia.

Severstal, which built up a 26.6 per cent Celtic stake earlier this year and claimed the support of 6.6 per cent holder American Barrick, has increased its offer for Celtic from 220p to 270p a share. Celtic has dismissed this as inadequate and a rival bidder is said to be waiting in the wings.

Celtic shares, which hit 464p in 2005 before plunging to 136.5p last January, were recommended as a recovery punt by Growth Company Investor at 178p in February and now stand at 271.5p. Hold on.

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