Bidding war: BHP raises its offer in takeover bid for Noront
A day after a rival suitor made a bid for control of Noront Resources, BHP has upped its offer for shares of the mining company that owns the rights to mineral in the Ring of Fire in northwestern Ontario.
BHP increased its all-cash offer to Noront shareholders to $0.75 per share, beating Australia's Wyloo Metals' offer of $0.70 a share, which was announced Tuesday.
The BHP offer will be open until 11:59 p.m. (Toronto time) on Nov. 9. Shareholders have 22 days to decide whether to accept.
"Our increased offer of C$0.75 per share provides a compelling premium for Noront shareholders and is available to shareholders now," BHP chief development officer, Johan van Jaarsveld, said in a news release Wednesday.
"Our offer provides shareholders with the value inherent in Noront’s portfolio of projects, including the Eagle’s Nest project, delivering shareholders who accept our offer certainty of value and immediate liquidity.”
"BHP recognizes that delivering Noront’s portfolio of projects in the Ring of Fire is expected to take many years, require significant capital investment, development of remote infrastructure, and management of numerous stakeholders," the release said.
"There is no certainty that shareholders remaining invested in Noront will ever realize the value for their shares offered by BHP in cash today."
Noront CEO Alan Coutts, said in the release that the BHP offer is superior to Wyloo's.
"Noront’s board of directors determined that BHP’s improved offer is in the best interests of the company and its shareholders and recommends Noront shareholders tender their shares to the BHP offer,” Coutts said.
“Now is the time for shareholders to decide if they want to tender to our improved offer and crystallize the compelling and full value it represents,” van Jaarsveld said.
Noront Resources Ltd. is focused on the development of its high-grade Eagle’s Nest nickel, copper, platinum and palladium deposit and chromite deposits, including Blackbird, Black Thor, and Big Daddy, all of which are located in the James Bay Lowlands of Ontario in an emerging metals camp known as the Ring of Fire.
BHP is an Australian-based global resources company with 80,000 employees and contractors, primarily in Australia and the Americas. The company has its potash head office is in Saskatoon and its head office for metals exploration is in Toronto.