Takeover target Noront Resources on Friday reiterated its support for BHP’s bid to acquire the company, stating that shareholder Wyloo Metals’ support was not required for the offer to succeed.
The Canadian company was responding to Wyloo’s statement on Thursday that it would not support BHP’s bid for the nickel junior and offer was thus unlikely to satisfy the minimum mandatory tender condition.
Wyloo has a 37.5% partially diluted interest in the company.
However, Noront said in its response that the minimum tender condition for the offer was that more than 50% of the shares not owned by BHP had to be tendered to the offer.
“This condition can be satisfied regardless of whether Wyloo tenders its Noront shares to the offer,” the company said, stressing that those shareholders wishing to receive the C$0.55 a share in cash offered by BHP could tender to the offer.
Wyloo said on Thursday that it was contemplating making a superior offer to that of BHP, but said that it had not been granted access to due diligence on “reasonable terms for a shareholder with a cornerstone position”.
Noront responded that prior to the offer, Noront had provided access to due diligence information to all parties that were prepared to enter into a customary confidentiality agreement typical for transactions of this nature. Wyloo was provided with an opportunity to execute such a confidentiality agreement, but declined to do so, Noront said.
“If Wyloo remains interested in engaging with Noront, the support agreement entered into between Noront and BHP contains customary terms that permit the company to engage with, and provide confidential information to, a party that makes a proposal to the company that is superior to the offer or would reasonably be expected to lead to a superior proposal. To date, the company has received no such proposals.”
Noront’s presence in the Ring of Fire is a key attraction for suitors. Its first project is a 100%-owned, high-grade nickel, copper and platinum group element deposit called Eagle’s Nest. It is the largest high-grade nickel discovery in Canada since Voisey’s Bay and the most advanced project in the Ring of Fire.
The other projects in its pipeline are the Blackbird and Black Thor chromite deposits in conjunction with a ferrochrome production facility in Sault Ste. Marie.