Source: Bloomberg, by Thomas Biesheuvel and Natalie Doss - Jan 14, 2011
ArcelorMittal, the largest producer of steel, joined with Nunavut Iron Ore Acquisition Inc. in a bid for Baffinland Iron Mines Corp. valued at about C$519 million ($522 million) that seeks to end a three-month takeover battle.
The two companies offered C$1.50 ($1.51) a share for 100 percent of Baffinland, Luxembourg-based ArcelorMittal said in a statement today. Nunavut previously bid C$1.45 a share for 60 percent and ArcelorMittal C$1.40 apiece for the entire company.
ArcelorMittal and Nunavut, backed by Houston-based private equity-firm Energy & Minerals Group, were vying for Baffinland’s Mary River project in the Canadian Arctic. ArcelorMittal, based in Luxembourg, is seeking greater access to iron ore as prices for the steelmaking material rise. ArcelorMittal would hold 70 percent of Baffinland and Nunavut the rest under the new offer.
The Mary River project contains an estimated 365 million metric tons of reserves and 500 million tons of resources in three deposits that have been partially explored.
“Together with Nunavut Iron, we are providing a more attractive offer to Baffinland shareholders than either of us were prepared to provide on our own,” Peter Kukielski, head of mining at ArcelorMittal, said in the statement.
Daniella Dimitrov, vice chairwoman of Baffinland, Richard McCloskey, chief executive officer, and Michael Zurowski, executive vice president, didn’t immediately return telephone calls seeking comment.
Baffinland rose 3 cents, or 1.9 percent, to C$1.54 as of 9:47 a.m. in Toronto Stock Exchange trading. ArcelorMittal slid 0.3 percent to 27.195 euros by 4.11 p.m. in Amsterdam.
The new bid’s value was calculated using the 345.86 million of outstanding Baffinland shares, according to Bloomberg data.