TORONTO (Reuters) - First Quantum Minerals Ltd said it will extend its C$5.1 billion ($4.97 billion) hostile bid for its smaller rival Inmet Mining Corp by a few days after a majority of Inmet shareholders tendered shares in favor of the offer.
Vancouver, British Columbia-based First Quantum said in a statement on Tuesday that a total of 43.2 million Inmet shares, representing about 61.5 percent of outstanding shares, had been tendered in favor of its offer. The offer has now been extended to 11:59 p.m. EDT on March 21.
The strong endorsement from Inmet shareholders takes First Quantum a step closer toward acquiring Inmet and winning control of the prized Cobre Panama project. The $6.2 billion project in the Central American country has one of the world’s largest undeveloped copper deposits, which would ease First Quantum’s dependence on mines in Africa, particularly Zambia.
Inmet had strongly urged its shareholders to reject First Quantum’s offer, arguing that the bid was inadequate.
First Quantum also said its offer has been varied to allow the minimum tender condition to be satisfied if more than 50 percent of Inmet’s outstanding shares have been deposited before the new expiry time of the offer. The offer was previously contingent on more than two-thirds of the shares being tendered in favor of the deal.
The cash-and-stock bid, which was earlier set to expire at 11:59 p.m. EDT on Monday, was worth roughly C$5.1 billion, or C$72 a share, when it was announced in mid-December, above First Quantum’s two previous offers for Inmet.
Inmet has said it would be willing to enter into discussions with First Quantum, if the company made a “fair” offer.
“While the long-term fundamental value of Inmet has not changed, the value of the First Quantum offer has declined,” said Inmet in an open letter to shareholders last week.
Inmet shares rose 1.9 percent to C$69.90 in early trading on the Toronto Stock Exchange on Tuesday, while First Quantum’s shares were roughly flat at C$20.65.
Reporting by Euan Rocha; Editing by Jeffrey Benkoe and Grant McCool