Cliffs raises Spider offer in pursuit of Big Daddy
- Publishing Date
- 29 Jun 2010 10:48am GMT
- Author
- Mining Journal
Cliffs Resources Inc has again raised its cash offer for Spider Resources Inc, owner of a 26.5% stake in the Big Daddy chromite deposit in Canada, has it strives to gain control of the asset.
In addition the company says it has a lock-up agreement with MineralFields Group, the largest shareholder in Spider Resources.
“In aggregate, Cliffs, Spider directors and officers, and MineralFields, through ownership of shares, options, and warrants of Spider, own approximately 21.5% of Spider's shares on a fully-diluted basis,” says Cliffs.
On Friday, KWG Resources Inc, which also owns 26.5%, raised its offer from 1.21 shares for every one owned to 1.30 shares, while also agreeing to retaining half of a 2% net smelter royalty over certain projects and railway assets that were all set to be “spun out” following the merger.
Cliffs’ latest offer of C$0.19/share is a 15% increase on its most recent offer, and 46% more than when it first proposed to buy out KWG or Spider in late May.
“Cliffs' strategic objective is to gain control of the Big Daddy chromite project located in the McFaulds Lake area of Northern Ontario,” said the company in a statement.
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