Xstrata launches takeover bid for Australia's Indophil
SYDNEY (AFP) — Anglo-Swiss resources giant Xstrata launched a 426 million dollar (400 million US) hostile takeover bid for Australian copper miner Indophil Thursday.
Indophil immediately rejected the offer, which Xstrata said was aimed at increasing its interest in the Tampakan copper and gold project in the southern Philippines.
The offer of one dollar a share was a significant premium to Indophil's Wednesday closing share price of 78 cents, but the Australian company said it was too low.
"This is yet another example of Xstrata opportunistically trying to pull off another lowball bid for an Australian company," Indophil chief executive Richard Laufmann told Australian Associated Press.
Indophil holds a 34.23 percent interest in the Tampakan project, while Xstrata copper owns 62.5 percent.
Xstrata Copper chief financial officer Luis Irvine said that increasing his company's interest in the project would "increase the certainty and the simplicity" of its development.
Indophil shares soared after the offer was announcing, closing up 31 cents or 40 percent to 1.09 dollars in a higher overall market.
"People think that, given that Indophil has already rejected the offer, that there will be an increased bid," Aequs Securities institutional dealer Ric Klusman said.
"I think investors will probably hang off and see if Xstrata will come back with 1.20, or something like that, because it's not a massive move for Xstrata and they have plenty of room to move."
