PERTH (miningweekly.com) – Takeover target Atlas Iron on Friday recommended the offer from Hancock Prospecting to shareholders, saying the board had unanimously agreed to recommend the offer.
The majority of the Atlas board earlier this month determined that the 4.2c a share offer from Hancock was superior to an earlier takeover offer from fellow-listed Mineral Resources, which has offered Atlas shareholders one new MinRes share for every 571 Atlas shares held.
The Hancock offer is expected to open next week, and Atlas on Friday told shareholders to hold off on taking any action, until the company issued a target statement and the independent expert’s report.
Meanwhile, Atlas on Friday also announced that it would cut-back production at its Mt Webber operation, and suspend ore processing at Mt Dove in late July.
The miner in June last year announced the decision to increase production at Mt Webber from seven-million tonnes a year to nine-million tonnes a year, with the incremental production earmarked for processing at the recommissioned Mt Dove site.
However, Atlas said that the tonnes processed at Mt Dove had a higher C1 cash costs than the tonnes processed at Mt Webber, owing to haulage and rehandling costs.
Given the challenging market conditions, the miner has now taken the decision to suspend ore processing at Mt Dove, and to reduce output from Mt Webber to about seven-million tonnes a year.
The miner told shareholders that the changes would not affect the existing lithium direct shipping ore processing activities at the Mt Dove operation.