Northern Iron surges as Indians fatten offer
Shares in Australia's Northern Iron (ASX:NFE) surged by around 38% in Tuesday trading, on news that India's Aditya Birla Group had increased its takeover offer by 4%, bringing the bid to USD$532 Million.
According to Reuters the latest offer by the Indian conglomerate is for AUD$1.40 per share, at a 75% premium to the Northern Iron's closing price on Monday.
Despite its Australian listing Northern Iron's chief productive asset is situated on the other side of the planet in northern Norway. The company is 100% owner of the Sydvaranger Iron Project, whose existing reserves of iron ore offer a mine life of over a quarter of a century.
The company produced 501,000 tonnes of iron ore in the first quarter of this year, and said in late May that output for the second quarter would be roughly commensurate.
The Australian reports that Northern Iron under Goldman Sachs' guidance announced on November 30 last year that the board had agreed to consider potential company offers as part of an overall strategic review.
Northern Iron had previously rebuffed an offer from Aditya Biria in May, at $1.23 – $1.29 per share, on the grounds that it undervalued the company's prospects.