SHAREHOLDERS of the company behind a deep underground mine have launched a bid to raise £460m to prevent a takeover.

Last month, Anglo American plc agreed a potential £405m deal to rescue Sirius Minerals plc, which has sites in Whitby and Scarborough.

The potential purchase of shares is said to likely "wipe out" cash invested by around 85,000 individuals, however the deal will only succeed if shareholders agree.

Sirius Minerals’ Investor Action Group has now been set up to try and raise the £460 million Sirius failed to raise last September by proposing to the company that they offer bonds to both institutional and private investors.

The group said the Anglo American offer is a "significant undervalue".

Mark Jones, a shareholder from Middlesbrough, who is one of the individuals behind the investor action group, said: "We represent all the shareholders who feel hard done by by the offer.

"Obviously people who bought into the company when shares were 3p are happy but we represent all the people who bought in when it was upwards of 15p.

"Some of these shareholders have lost a considerable amount of money."

He added: "The deal is low ball. They are buying a grade one facility at the bottom of the market. There are minerals down there for 100 years. Once it is up and running it is a cash machine, or so we have been led to believe.

About 50 per cent of Sirius Minerals share are held by private individuals, according to the group, with about 11,000 shareholders in the Yorkshire and surrounding area.

Two weeks ago, Sirius Minerals plc announced its shares were available to trade at 5.5p per share, worth just a fraction of what they were worth a year ago at 22.38p

A shareholder vote is set to take place on March 3 and a court hearing to hear arguments for and against the takeover is scheduled for March 20.

Sirius says the Anglo American takeover is the only option that could prevent the company from going bust.

A spokesperson for the company said: We recognise that the current offer does not represent the value that the board and shareholders had previously hoped for. However, given the situation the company finds itself in, we face a stark choice.

"As such, the board has been unanimous in recommending that shareholders vote in favour of the deal.  In the event of this transaction being unsuccessful there is a high probability that the business will need to be placed into administration or liquidation."

This week, the Yorkshire Coast Mineral Association said the mine "must continue" for the benefit of the Whitby and Scarborough area.

A statement released by the association, which represents the Mineral Rights Holders who are leasing their minerals to the project, said: "We fully acknowledge the disappointment that share-holders who have backed the project will be feeling. Indeed, many of our members also invested and will be sharing the loss.

"But now is the time to support the scheme so that the multiple benefits to the local community and national economy can be unlocked. It will be tragic if the future benefits of the project are left to wither on the vine."

More information on the Sirius Minerals’ Investor Action Group can be found at fundsirius.com