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Sundance accepts Hanlong's reduced offer
By Richard Fu |
August 27, 2012, Monday
|
Online Edition
Online Edition
AUSTRALIA-BASED iron ore miner Sundance Resources Ltd said it has accepted a reduced takeover offer from China's Hanlong Mining Investment Ltd, moving closer to ending their long-negotiated deal amid falling iron ore prices.
Hanlong's new offer of 45 Australian cents per share, compared with an earlier bid of 57 cents, would value Sundance at A$1.37 billion (US$1.42 billion). Still, the discounted offer is 34 percent higher than Sundance's closing price on July 31, pending today's announcement.
Sundance rose as much as 13 percent today as trading resumed in Sydney.
Sundance Chairman George Jones said the board has decided to accept the lower offer after extensive negotiations with Hanlong and after considering a range of factors including the change in financial markets since the original agreement was struck in October 2011.
"The board believes that the revised offer is worthy of putting to shareholders in light of several key considerations," Jones said in a statement.
Hanlong already owns 17 percent of Sundance, which owns the Mbalam iron ore project on the border of Cameroon and Congo in western Africa.
Sichuan-based Hanlong said earlier this month that it received provisional approval from the National Development and Reform Commission, China's top planning agency, to acquire Sundance.
Sundance expected the deal to be completed by mid-December.
Hanlong's new offer of 45 Australian cents per share, compared with an earlier bid of 57 cents, would value Sundance at A$1.37 billion (US$1.42 billion). Still, the discounted offer is 34 percent higher than Sundance's closing price on July 31, pending today's announcement.
Sundance rose as much as 13 percent today as trading resumed in Sydney.
Sundance Chairman George Jones said the board has decided to accept the lower offer after extensive negotiations with Hanlong and after considering a range of factors including the change in financial markets since the original agreement was struck in October 2011.
"The board believes that the revised offer is worthy of putting to shareholders in light of several key considerations," Jones said in a statement.
Hanlong already owns 17 percent of Sundance, which owns the Mbalam iron ore project on the border of Cameroon and Congo in western Africa.
Sichuan-based Hanlong said earlier this month that it received provisional approval from the National Development and Reform Commission, China's top planning agency, to acquire Sundance.
Sundance expected the deal to be completed by mid-December.
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