Photo by: Bloomberg
PERTH (miningweekly.com) – Takeover target Atlas Iron has backed a takeover offer from Hancock Prospecting, after suitor Mineral Resources (MinRes) pulled out of the race by failing to match the offer.
MinRes earlier this week said that it would not make a counter offer for Atlas, after Hancock Prospecting launched a superior offer for the iron-ore miner, offering shareholders 4.2c in cash for each Atlas share held.
MinRes, for its part, was offering Atlas shareholders one MinRes share for every 571 Atlas shares held, valuing the company’s shares at 3.02c a share, based on the closing price of both companies before the offer.
The Atlas directors maintained their backing for the MinRes bid while the company was given an opportunity to match the Hancock bid; however, with MinRes deciding that it would not increase its offer for Atlas, the directors of that company had now thrown their weight behind the Hancock bid.
Atlas will be liable for a A$3.12-million break fee under its initial scheme implementation deed with MinRes, as a result of this change of heart.