Deep-sea mining dust clouds travel long distances – research
A portion of the stirred-up bottom material caused by deep-sea mining remains visible in the water at long distances.
Western Areas Ltd agreed to a revised takeover offer from nickel-lithium miner IGO Ltd on Monday that valued the Australian nickel producer at A$1.26 billion ($939 million), lifting its shares to their highest level since April 2018.
The revised offer of A$3.87 for every Western Areas share is 15.2% higher than the prior offer of A$3.36 apiece and represents a premium of 6% to the stock’s last close.
Western Areas shares, which have risen more than 6% since IGO first tabled its bid last December, jumped 5.8% on Monday while IGO’s stock gained nearly 4.5%.
IGO has been looking to beef up its portfolio with assets rich in nickel and lithium, both raw materials used in electric-vehicle batteries. It bought a $1.4 billion stake in Tianqi Lithium’s 002466.SZ Australian assets last June.
Western Areas’ board had initially recommended shareholders’ vote in favour of the A$3.36-per-share deal, but its view changed after an unprecedented surge in nickel prices last month as Russia’s invasion of Ukraine hit a short bet made by top producer Tsingshan Holding Group.
Earlier this month, IGO said its takeover of Western Areas might fall through after an independent expert concluded the offer was “neither fair nor reasonable”.
The companies, however, confirmed on Monday that a consultation process resulted in an agreement to increase the offer price to A$3.87 per share.
“The company recognises that higher (nickel) prices have resulted in stronger financial performance from Western Areas compared with IGO’s assumptions (when) the initial scheme was announced in December 2021,” said IGO Chief Executive Officer Peter Bradford.
The nickel-lithium miner said it will fund the revised deal through a combination of a new A$900 million senior-secured debt facility and existing cash reserves.
($1 = 1.3414 Australian dollars)
(By Harish Sridharan and Jaskiran Singh; Editing by Tom Hogue and Sherry Jacob-Phillips)
Comments