ArcelorMittal set to buy Canadian iron ore company for $433 millionDecember 16th, 2010 - 2:01 pm ICT by IANS
By Gurmukh Singh
Toronto, Dec 16 (IANS) Unless a rival bidder emerges possibly from China by Monday, ArcelorMittal is set to take over Canada’s Baffinland Iron Mines for $433 million.ArcelorMittal has already received a ‘no action’ letter from Canada’s Commissioner of Competition for its bid, clearing the way for its takeover of Baffinland until a rival bid emerges by December 20.
The ‘no action’ letter for ArcelorMittal waives the need for a review of the deal by Industry Canada (the industry ministry).
Baffinland Iron Mines is a mining company focused on mineral exploration and development of its fully owned Mary River iron-ore deposits on Baffin Island in the union territory of Nunavut - almost touching Arctic regions.
ArcelorMittal is eying the company’s prized Mary River iron-ore deposits to secure future supply for its plants.
A 2008 feasibility study said Mary River’s high-grade iron-ore deposits can produce 18 million tonnes of iron ore annually for up to two decades. Recent discoveries hint even bigger deposits.
But to bring the Mary River project into production, Baffinland said to need up to $4 billion.
Before ArcelorMittal’s takeover bid, Baffinland held talks with the steel giant to develop Mary River as a joint project.
But a sudden hostile takeover bid in September forced Baffinland’s board of directors to enter into a “friendly deal” with ArcelorMittal for $1.10 in cash per share.
However, the “friendly deal” upset Baffinland’s CEO Gord McCreary and he quit. Since then, he has been trying to get some Chinese state-owned company to challenge the ArcelorMittal’s offer by the Monday deadline.
Baffinland stock shot up 9.73 percent Wednesday on expectation of its takeover by the world’s biggest steel company. The stock closed $1.24 - up 9.73 percent - on the Toronto Stock Exchange.
ArcelorMittal, which accounts for 8 percent of the global steel output, already has a huge presence in Canada with its mining, steel making and tube manufacturing facilities in the provinces of New Brunswick, Ontario and Quebec.
(Gurmukh Singh can be contacted at email@example.com)
- ArcelorMittal, partner nearing absolute control of Baffinland - Feb 08, 2011
- ArcelorMittal says it won't extend Canadian takeover offer - Dec 23, 2010
- ArcelorMittal again gets nod from Canadian company for takeover - Jan 05, 2011
- Rival betters ArcelorMittal's offer for Toronto mining company - Jan 03, 2011
- ArcelorMittal, partner buy more Baffinland stock - Feb 02, 2011
- Arcelor, partner in virtual takeover of iron-ore giant - Feb 19, 2011
- ArcelorMittal forced to up bid for Canadian iron-ore giant - Dec 20, 2010
- ArcelorMittal sticks to offer deadline as rival raises bid - Dec 30, 2010
- ArcelorMittal hikes bid for Canadian iron ore giant - Jan 01, 2011
- ArcelorMittal again extends bid for Canadian ore company - Jan 11, 2011
- Now ArcelorMittal joins rival in joint bid for Canadian ore co. - Jan 15, 2011
- ArcelorMittal bid goes before Canadian regulators - Dec 22, 2010
- Jharkhand considering MoU renewal for ArcelorMittal steel plant - Aug 01, 2012
- ArcelorMittal Liberia announces first iron ore shipment - Mar 20, 2012
- S&P; cuts ArcelorMittal ratings to junk status - Aug 03, 2012
Tags: arctic regions, baffin island, baffinland iron, chinese state, feasibility study, global steel, grade iron, hostile takeover, industry canada, industry ministry, iron mines, iron ore company, iron ore deposits, mary river, recent discoveries, steel giant, steel output, takeover bid, territory of nunavut, toronto stock exchange