Kazakhmys' board recommends deal to go private
Kazakhmys plc (LON:KAZ) board is telling its shareholders to accept a deal that will buy out the portion of the company owned by Eurasian Natural Resources Corporation (LSE:ENRC).
A consortium of founders comprising of Alexander Machkevitch, Alijan Ibragimov, Patokh Chodiev and the Government of Kazakhstan are behind the buyout. The bid is valued at $4.7 billion.
In a news release the Kazakhmys board warned that the deal was the best alternative for shareholders.
"In the light of the significant issues currently facing ENRC and the prospects for ENRC and the impact on its value if the Offer does not proceed, the board of Kazakhmys believes that the offer represents the only realistic opportunity to realise value for the Group's investment in ENRC," writes Simon Heale, Chairman of Kazakhmys.
"The Board has acted to safeguard the Offer for Kazakhmys Shareholders and the ultimate decision on whether to accept the Offer is for Kazakhmys Shareholders."
Kazakhmys will receive approximately US$887 million in cash and 77,041,147 Kazakhmys shares. The company says the funds willbe used to grow is major copper projects, Bozshakol and Aktogay.
Kazakhmys PLC is a fully-integrated miner with open pit and underground mines, as well as smelters and railways. It is the largest copper producer in Kazakhstan and eleventh-largest in the world.