Baffinland seeks acceptance of takeover bid

17th January 2011, Comments 0 comments

Canadian mining company Baffinland on Monday urged shareholders to accept a joint takeover offer by Europe's ArcelorMittal and Nunavut Iron Ore, valued at about Can$600 million.

In a statement, its board announced it has "recommended that Baffinland's securityholders accept the ArcelorMittal and Nunavut Iron Ore joint offer."

ArcelorMittal and Nunavut Iron Ore agreed last week to a Can$1.50 per share joint offer, ending a bidding war over Baffinland, which specializes in the development of iron ore sites along the Mary River in Canada's Arctic.

The joint bid represents a seven-percent premium to ArcelorMittal's last offer and an 88 percent premium to the original Nunavut offer of Can$0.80 per common share.

The offer is open for acceptance until 11:59 p.m. Toronto time on January 24 (0459 GMT on January 25).

ArcelorMittal has already locked up a quarter of Baffinland's shares while Nunavut owns a 10.3 percent stake in the company. If their bid succeeds, they have said they would split ownership of Baffinland 70-30 percent, respectively.

Luxembourg-based ArcelorMittal has sought to boost self-sufficiency in iron ore in order to lessen its dependence on the three main producers, BHP Billiton, Vale and Rio Tinto.

© 2011 AFP

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