Apr 8 2003
Xstrata have announced a bid for the takeover of Australian-based MIM via a wholly owned subsidiary. MIM are a mining and minerals processing company producing copper, gold, zinc, lead, silver and coal, with operations in Australia, UK and Argentina.
Under the scheme, Xstrata will purchase all shares in MIM for AUD$1.72 per share, valuing the assets of MIM at AUD$3.44 billion. MIM and Xstrata have signed an agreement to implement the scheme, which is subject to approval from shareholders and governing bodies.
The board’s approval of the scheme was based on approval from an independent expert and the failure of the board to identify an alternative, including other offers, joint ventures or demergers, that will bring equivalent shareholder value. Furthermore, the board realise that the current share value is inflated due to the Xstrata offer, and would probably only reach AUD$1.72 under favourable conditions in the medium to long term.
While the decision to approve the scheme was not unanimous, MIM will apply to the courts to call for a shareholder meeting where a final decision will be made on the Xstrata takeover. For the scheme to be proceed it will require the approval of 75% of the shareholders.
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