Xstrata bolsters offer for Sphere

Finance

Peter Freyberg, chief executive officer of the coal business for Xstrata Plc. Photo: Bloomberg

Publishing Date: 03 Nov 2010 2:36pm GMT
Author: Mining Journal

Xstrata has boosted its offer for Sphere Minerals Ltd by 20% to A$3/share in a final effort to sway the Australian-based company’s shareholders.

The increased bid sees the Swiss company’s offer grow from A$428 million (US$410 million) to A$514 million. Xstrata explained that the improved takeover attempt is final, and that it will not be increased again. The offer is scheduled to close on November 12.

Peter Freyberg, Xstrata Coal chief executive, said: “We believe our cash offer of A$3 per Sphere share is very attractive to Sphere shareholders and demonstrates our willingness to expedite the completion of our offer.

“Xstrata’s offer is the only opportunity for shareholders to realise certain cash value for their investment in Sphere in the short-term at a substantial premium of 94% to the pre-offer price of A$1.55.”

Xstrata, through wholly-owned subsidiary Sidero Pty, has declared a takeover will become unconditional if more than 50% of Sphere shareholders accept the terms by the end of the offer period.

At the close of business on November 2, Xstrata’s interest in Sphere was sitting at 8.1%.