Xstrata makes $10 billion bid for Lonmin
Anglo-Swiss mining giant Xstrata PLC said on Wednesday it was making a $10 billion cash offer for Lonmin PLC, the world's No. 3 platinum miner.
By Agencies |
ZUG: Anglo-Swiss mining giant Xstrata PLC said on Wednesday it was making a $10 billion cash offer for Lonmin PLC, the world's No. 3 platinum miner.
Xstrata was offering $33 for each Lonmin share, which it said is a 42 per cent premium on Tuesday's closing price. Zug-based Xstrata already holds 8.03 per cent of Lonmin's shares. Xstrata, meanwhile, reported profits of $2.75 billion, or $2.87 per share, in the first half of the year. The results represent an 8 per cent drop in profits compared to the year-earlier period.
Xstrata CEO Mick Davis said the bid for London-based Lonmin ``marks the next step in our strategy to develop a significant platinum business and add further scale and diversification to our portfolio.''
Platinum is used in jewelry and for catalytic converters in automobiles. Expectations of growing demand in China for the metal led prices to surge from about $1,225 per troy ounce a year ago to $2,250 per ounce in February. Prices have since fallen under $1,600 again.
Xstrata was offering $33 for each Lonmin share, which it said is a 42 per cent premium on Tuesday's closing price. Zug-based Xstrata already holds 8.03 per cent of Lonmin's shares. Xstrata, meanwhile, reported profits of $2.75 billion, or $2.87 per share, in the first half of the year. The results represent an 8 per cent drop in profits compared to the year-earlier period.
Xstrata CEO Mick Davis said the bid for London-based Lonmin ``marks the next step in our strategy to develop a significant platinum business and add further scale and diversification to our portfolio.''
Platinum is used in jewelry and for catalytic converters in automobiles. Expectations of growing demand in China for the metal led prices to surge from about $1,225 per troy ounce a year ago to $2,250 per ounce in February. Prices have since fallen under $1,600 again.
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