China's Minmetals makes $6.5bn bid for Equinox
Tuesday 05 April 2011
Minmetals resources, the state-backed Chinese metals trader, surprised the markets yesterday by tabling a $6.5bn (£4bn) bid for Equinox Minerals, the dual Canada and Australia-listed group which has been vying to take over Canada's Lundin Mining.
The proposal, which is conditional on Equinox dropping its pursuit of Lundin, is the latest in a series of moves by Chinese companies to secure resources to satisfy the country's growing appetite for metals. In this instance, Minmetals is believed to be after Equinox's copper assets in Zambia and Saudi Arabia, a valuable resource for China, which accounts for 40 per cent of global copper demand.
The bid, which is pitched at C$7 (£4.50) per Equinox share, represents a 23 per cent premium to Equinox's closing price in Toronto at the end of last week and, if successful, would go down as China's fourth-biggest overseas deal on record.
News of the offer drove Equinox's shares beyond the Minmetals offer price, indicating that the market may be eyeing the prospects for a rival bid. Despite the share price reaction, analysts were quick to highlight that prospective suitors would face an uphill challenge in taking on China's financing might.
"Ultimately, no one wants to get into a bidding war with Chinese-related parties, given that Chinese companies are perceived to have a lower cost of capital relative to Western companies," said Tim Schroeders, a fund manager at Pengana Capital.
elephant appealThe first 23 lots in our charity auction have now gone. But there are 22 more still up for grabs
Geoffrey Macnab reviews American Hustle, also starring Christian Bale and Bradley Cooper
Dennis Rodman will coach the North Korea basketball team
Jennifer Lawrence: 'It should be illegal to call someone fat on TV'
Ian Watkins: Police probed over earlier allegations as paedophile Lostprophets singer sentenced to 35 years for child sex offences
Iain Duncan Smith leaves Commons food banks debate early
Paul Walker death caused by speed alone
Devyani Khobragade: India-US row escalates over arrest of diplomat in New York
- 1 America's 'virgin births'? One in 200 mothers 'became pregnant without having sex'
- 2 Sun will 'flip upside down' within weeks, says Nasa
- 3 Christmas comes early: Justin Bieber is 'retiring from music'
- 4 Iain Duncan Smith leaves Commons food banks debate early
- 5 Children evacuated from swimming pool after prosthetic leg mistaken for paedophile
- < Previous
- Next >
iJobs Money & Business
£500 - £550 per day: Cornwallis Elt : Business Analyst Target Operating Mod...
£500 - £680 per day: Harrington Starr: Murex Business Analyst - 1000 CHF per d...
£60000 - £75000 per annum + Bonus and Benefits: Harrington Starr: A leading au...
£25000 - £32000 per annum: Harrington Starr: Junior Business Analyst - Banking...