Noront agrees to sell to Wyloo Metals, says offer is superior to BHP
In a statement, Noront said the offer is superior to BHP's offer of C$0.55 per share and represents better value for shareholders.
If the deal goes through, current shareholders can sell their stock at 70 cents each, or hold on to them and continue as common shareholders.
Noront CEO Alan Coutts said the company's board of directors has determined Wyloo's offer is superior.
“Based on an evaluation by the special committee and its advisors, the Noront board of directors has determined that Wyloo Metals’ proposal represents superior value for our shareholders, compared to the offer by BHP," Coutts said in the release.
However, BHP has the right to match the offer within five days. If the company decides not to match, Wyloo Metals will loan Noront $23 million to finance, among other things, $13 million payable to BHP for terminating its bid to take over the company.
Currently, Wyloo currently owns about 37.25 per cent of Noront common shares.
Noront is focused on the development of its high-grade Eagle’s Nest nickel, copper, platinum and palladium deposit and the world class 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.
Noront has announced plans to build a chromite smelter in Sault Ste. Marie.