3 Min Read
* Inmet says not in talks to sell company, major assets
* Denial follows speculative report in British newspaper
* Daily Mail suggests Inmet held talks with First Quantum
* Shares close down 5.32 percent at C$54.44 on TSX (Adds analyst comment)
Nov 13 (Reuters) - Canada's Inmet Mining Corp said on Tuesday that it is not in talks with any party about a sale of the company or a substantial part of its assets, contradicting a British media report, and its shares fell 5 percent.
The statement from the base metal miner followed a report late on Monday on the website of the Daily Mail newspaper that suggested the company had held informal tie-up talks with larger rival First Quantum Minerals Ltd.
The newspaper article, which was unsourced, speculated that a takeover bid could be worth as much as C$5 billion (US$5 billion). Inmet's market capitalization, as of the close of the market on Monday, was nearly C$4 billion.
Shares of Inmet closed down 5.32 percent at C$54.44 on Tuesday on the Toronto Stock Exchange after the company denied the takeover rumors.
The Toronto-based miner said it remained focused on the construction and development of its $6.2 billion Cobre Panama project in Central America.
Despite the denial, a deal between First Quantum and Inmet could make sense, BMO Capital Markets mining analyst Stephen Bonnyman wrote in a note to clients on Tuesday.
"First Quantum trades at a decided premium to its peer group and Inmet at a discount, making a potential deal quite accretive on many measures," he said, adding that Inmet is attractive due to its size and its stake in Cobre Panama.
"The potential acquisition would maintain First Quantum's copper focus while substantially diversifying its geographic concentration," Bonnyman said.
First Quantum operates copper mines in Zambia and Mauritania, and a nickel mine in Western Australia. Its stock closed down 2.46 percent at C$22.19 on Tuesday.
Inmet owns copper mines in Turkey, Spain and Finland, and holds an 80 percent stake in the Cobre Panama project in Panama, with the remaining interest held by a Korean consortium.
The company confirmed earlier this month that it remained open to selling another minority stake in that project.
Inmet recently backed away from a takeover of its own after its C$130 million hostile bid for Petaquilla Minerals Ltd failed to secure shareholder support.
$1=$1.00 Canadian Reporting by Julie Gordon; Editing by Janet Guttsman; and Peter Galloway