Inco rejects CVRD bid
Inco, the world’s second-largest nickel producer, said investors should accept a C$19.3bn ($17.4bn) takeover offer from Phelps Dodge and reject a rival cash bid from Brazil’s Companhia Vale do Rio Doce (CVRD).
By Agencies |
TORONTO: Inco, the world’s second-largest nickel producer, said investors should accept a C$19.3bn ($17.4bn) takeover offer from Phelps Dodge and reject a rival cash bid from Brazil’s Companhia Vale do Rio Doce (CVRD).
CVRD “indicated” it wouldn’t increase its offer, Toronto-based Inco said. Phoenix-based Phelps Dodge is the largest US producer of copper. Inco shareholders will meet on September 7 to vote on Phelps Dodge’s offer of C$20.25 a share in cash and 0.672 of a Phelps Dodge share. The offer is subject to getting at least two-thirds of the votes cast.
It’s also subject to Phelps Dodge getting supporting votes from its own shareholders representing more than half of its 203.5m shares outstanding to close the deal. Phelps Dodge shareholders are scheduled to vote on September 25.
Atticus Capital, the second-largest shareholder of Phelps Dodge, on August 11 affirmed its opposition to Phelps Dodge’s bid to acquire Inco and said it may seek formal support from other investors against the offer. It said it prefers a return of capital or an outright sale of Phelps Dodge.
Surging metal prices have triggered a spate of takeovers among mining companies seeking to increase production. Barrick Gold Corp became the world’s largest gold producer in March after completing a $10bn acquisition of Placer Dome.
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Nickel, used to make steel rust-resistant, has more than doubled in price this year, reaching $29,950 a ton on August 22, the highest in at least 19 years.Download
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