24.05.2007, 08:06
Norilsk Nickel Increases its Offer for LionOre to Cdn$27.50 per Share
OREANDA-NEWS. On May 23, 2007 OJSC MMC Norilsk Nickel (“Norilsk Nickel” or the “Company”) announced that it will increase its offer to purchase all of the outstanding common shares of LionOre Mining International Ltd. (“LionOre”) (Toronto Stock Exchange and Australian Securities Exchange symbol: “LIM”; London Stock Exchange symbol: “LOR”; Botswana Stock Exchange symbol: “LIONORE”) to Cdn$27.50 per common share. Norilsk Nickel expects to mail the Notice of Variation of its offer to LionOre shareholders on or about May 24, 2007. The offer will be open until 8:00pm (Toronto time) on Monday, June 18, 2007, unless extended or withdrawn, reported the press-centre of OJSC MMC Norilsk Nickel.
The cash offer represents an increase of Cdn$6,00 per common share over Norilsk Nickel’s previous offer of Cdn$21,50 per common share, and a premium of 10% over the Cdn$25,00 price per share offered by Xstrata plc (“Xstrata”) in its increased bid for LionOre. Assuming that all common shares are tendered, Norilsk Nickel’s increased offer represents total cash consideration of approximately Cdn$6,8 billion, and provides around Cdn$620 million more cash to LionOre shareholders than the Xstrata offer.
“Norilsk Nickel’s decision to increase its offer reflects the quality and strategic value of LionOre to our Company, which will give us greater scale in key commodities, enhanced geographic diversification and an exciting pipeline of growth projects,” said Norilsk Nickel’s General Director, Denis Morozov. “Our bid has been discounted to take into account the additional costs arising from the excessive Cdn$305 million break fee payable to Xstrata. This break fee has compromised a fair bidding process, and value, which should have been delivered to LionOre shareholders, instead may go to Xstrata.”
Today, Norilsk Nickel will deliver its proposal to LionOre’s Board of Directors and firmly believes it constitutes a “superior proposal” under the terms of the Support Agreement that LionOre entered into with Xstrata.
Yesterday, Norilsk Nickel received notice from Germany’s Federal Cartel Office that Norilsk Nickel’s proposed acquisition of control of LionOre has been approved under the German Act Against Restraints on Competition (as amended) (the “Act”). The Federal Cartel Office concluded that Norilsk Nickel’s all cash offer to the shareholders of LionOre was not likely to lead to the creation or strengthening of a dominant position and, therefore, Norilsk Nickel’s offer is not subject to further review under the Act. As previously announced on May 15, Norilsk Nickel received a no-action letter and waiver from notification from the Canadian Competition Bureau, and is therefore free to proceed with its offer with no further anti-trust review required in Canada. Norilsk Nickel continues to work closely with other applicable regulatory authorities in connection with their review of the pending acquisition.
Full particulars of the offer are set out in the offer and offering circular filed by Norilsk Nickel on May 7, 2007, as the terms of such documents may be amended by the Notice of Variation to be mailed to LionOre shareholders and filed with applicable regulatory authorities. These documents are available on the Canadian Securities Administrator’s web site at www.sedar.com under LionOre’s company profile, and on the Norilsk Nickel web site at www.nornik.ru/en.
Forward Looking Statements
This press release includes “forward-looking statements” that are subject to a number of risks and uncertainties, many of which are beyond Norilsk Nickel’s control, that could cause actual results to differ materially from those set forth in, or implied by such forward-looking statements. All statements other than statements of historical facts included in this press release are forward-looking statements. Although Norilsk Nickel believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. All forward-looking statements speak only as of the date of this press release and Norilsk Nickel undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. There can be no assurance that any transaction between Norilsk Nickel and LionOre will occur, or will occur on the timetable contemplated hereby.
For a discussion of risks and uncertainties regarding Norilsk Nickel’s business, which could cause actual results to differ form those contained in the forward-looking statements contained herein, please refer to the section entitled “Risk Factors” contained in Norilsk Nickel’s Annual Report for the fiscal year ended December 31, 2005.
The cash offer represents an increase of Cdn$6,00 per common share over Norilsk Nickel’s previous offer of Cdn$21,50 per common share, and a premium of 10% over the Cdn$25,00 price per share offered by Xstrata plc (“Xstrata”) in its increased bid for LionOre. Assuming that all common shares are tendered, Norilsk Nickel’s increased offer represents total cash consideration of approximately Cdn$6,8 billion, and provides around Cdn$620 million more cash to LionOre shareholders than the Xstrata offer.
“Norilsk Nickel’s decision to increase its offer reflects the quality and strategic value of LionOre to our Company, which will give us greater scale in key commodities, enhanced geographic diversification and an exciting pipeline of growth projects,” said Norilsk Nickel’s General Director, Denis Morozov. “Our bid has been discounted to take into account the additional costs arising from the excessive Cdn$305 million break fee payable to Xstrata. This break fee has compromised a fair bidding process, and value, which should have been delivered to LionOre shareholders, instead may go to Xstrata.”
Today, Norilsk Nickel will deliver its proposal to LionOre’s Board of Directors and firmly believes it constitutes a “superior proposal” under the terms of the Support Agreement that LionOre entered into with Xstrata.
Yesterday, Norilsk Nickel received notice from Germany’s Federal Cartel Office that Norilsk Nickel’s proposed acquisition of control of LionOre has been approved under the German Act Against Restraints on Competition (as amended) (the “Act”). The Federal Cartel Office concluded that Norilsk Nickel’s all cash offer to the shareholders of LionOre was not likely to lead to the creation or strengthening of a dominant position and, therefore, Norilsk Nickel’s offer is not subject to further review under the Act. As previously announced on May 15, Norilsk Nickel received a no-action letter and waiver from notification from the Canadian Competition Bureau, and is therefore free to proceed with its offer with no further anti-trust review required in Canada. Norilsk Nickel continues to work closely with other applicable regulatory authorities in connection with their review of the pending acquisition.
Full particulars of the offer are set out in the offer and offering circular filed by Norilsk Nickel on May 7, 2007, as the terms of such documents may be amended by the Notice of Variation to be mailed to LionOre shareholders and filed with applicable regulatory authorities. These documents are available on the Canadian Securities Administrator’s web site at www.sedar.com under LionOre’s company profile, and on the Norilsk Nickel web site at www.nornik.ru/en.
Forward Looking Statements
This press release includes “forward-looking statements” that are subject to a number of risks and uncertainties, many of which are beyond Norilsk Nickel’s control, that could cause actual results to differ materially from those set forth in, or implied by such forward-looking statements. All statements other than statements of historical facts included in this press release are forward-looking statements. Although Norilsk Nickel believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. All forward-looking statements speak only as of the date of this press release and Norilsk Nickel undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. There can be no assurance that any transaction between Norilsk Nickel and LionOre will occur, or will occur on the timetable contemplated hereby.
For a discussion of risks and uncertainties regarding Norilsk Nickel’s business, which could cause actual results to differ form those contained in the forward-looking statements contained herein, please refer to the section entitled “Risk Factors” contained in Norilsk Nickel’s Annual Report for the fiscal year ended December 31, 2005.
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