Noront Resources’ board has recommended the company’s shareholders to vote in favour of the amended offer from the mining major
BHP has sweetened its takeover bid to Canadian mining company Noront Resources to C$419.3m ($339.1m) or C$0.75 per share in cash.
The Canadian firm’s board has recommended shareholders vote in favour of the amended offer from the mining major.
BHP’s offer has been considered to be a superior proposal compared to the price of C$0.7 ($0.56) per share in cash offered by Wyloo Metals to Noront Resources’ shareholders.
Earlier this week, Wyloo Metals had reached an agreement with the Canadian firm regarding the takeover after the latter’s board recommended the proposal.
With the amended offer from BHP, Noront has determined that the proposal from Wyloo Metals has ceased to be a “superior proposal”.
Wyloo Metals, through its fully-owned subsidiary Wyloo Canada, holds a stake of 37.5% in Noront Resources.
The revised offer from BHP represents a 36% premium to its previous offer, a 7% premium to the Wyloo offer and a 213% premium to Noront’s unaffected price.
BHP had previously submitted an offer in July 2021 to acquire Noront Resources at a price of C$0.55 ($0.45) per share.
According to BHP, its offer gives certainty of value to Noront Resources’ shareholders, while eliminating financing, market, regulatory, and execution risks.
BHP chief development officer Johan van Jaarsveld said: “Our increased offer of C$0.75 per share provides a compelling premium for Noront shareholders and is available to shareholders now.
“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.”
Noront Resources is mainly focused on developing the Eagle’s Nest nickel, copper, and palladium deposit in the Ring of Fire region in Northern Ontario, Canada.
BHP and Noront Resources stated that the amended offer gives the latter’s shareholders the value inherent in its portfolio of projects without the long-term risks that come with their development and execution.
Noront Resources CEO Alan Coutts said: “This transaction provides a premium to Wyloo’s offer, and delivers certainty of value to Noront shareholders via an all-cash offer.
“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.”