Shareholders of Toronto- and New York-listed Turquoise Hill will on November 1 vote on the cash takeover offer from Rio Tinto, the company behind one of the world’s biggest copper mines has confirmed.
Rio Tinto last month offered C$43 a share for the remaining stake in Turquoise Hill, which owns the Oyu Tolgoi mine, in Mongolia.
The special meeting comes as the Supreme Court of Yukon last week granted an interim order in connection with the statutory plan of arrangement under section 195 of the Business Corporations Act, pursuant to which Rio Tinto will acquire the about 49% of the issued and outstanding common shares of Turquoise Hill that it did not currently own.
The Interim Order authorises the calling and holding of a special meeting (the “Special Meeting”) of the company’s shareholders, the granting of dissent rights to registered shareholders and other matters relating to the conduct of the special meeting.
The purchase price of C$43 a share reflects a 67% premium to Turquoise Hill’s closing price of C$25.68 a share on the TSX on March 11, being the last trading day prior to Rio Tinto’s initial public proposal to acquire the minority shares, and a 19% premium to Turquoise Hill’s closing price of C$36.12 on August 31, being the last trading day prior to the September 1, announcement of the term sheet in respect of the arrangement.
Pentwater Capital Management early in September argued Rio’s price offer undervalued Turquoise Hill given that there’s a high probability copper prices will be higher than $4/lb over the next decades amid growing demand for the metal to power the energy transition.
Rio Tinto CEO Jakob Stausholm has made it clear that its offer is final.