BHP says it could up offer for Canadian nickel play as bidding war with Twiggy Forrest heats up
BHP has signalled it won’t walk away from its fight with Andrew Forrest for control of Canadian nickel explorer Noront Resources.
Canadian nickel explorer Noront Resources says it will keep backing BHP’s bid for the company until it receives a firm offer from Andrew Forrest’s Wyloo Metals, as BHP signalled it won’t walk away from its fight for control of the company.
BHP said on Wednesday it would consider topping a revised C70c a share pitch for Noront by Wyloo, as it released conditions in its own bid to the Canadian nickel miner to allow its board to give Wyloo access to due diligence information.
In a statement released on Tuesday night, Noront chief executive Alan Coutts said the company would offer Wyloo the opportunity to conduct due diligence on the company in the wake of its promise to top BHP’s $C325m friendly takeover offer, but told shareholders the board was still backing the mining’s giant’s firm C55c a share bid.
Wyloo said on Tuesday it was prepared to offer C70c a share for Noront scrip, topping BHP’s offer by about 27 per cent. Dr Forrest’s company has also promised to keep Noront as a listed public company, with Dr Forrest to chair the company’s board if Wyloo wins control.
But Noront echoed BHP’s complaint on Tuesday that Wyloo was conducting its takeover through press releases rather than on the market, saying its board had not received a binding offer for control.
“Noront reminds shareholders that Wyloo has never made a binding offer to acquire the common shares of Noront, and that no such offer may ever be made by Wyloo,” the company said in a statement to the Canadian market.
“The only binding offer available to shareholders is BHP’s offer of C55c cash per Noront share, which the board of directors of Noront continues to support.”
Wyloo boss Luca Giacovazzi said on Tuesday the company had no intention of selling its stake in Noront into the BHP bid, as the battle for control of the company’s position in one of Canada’s most prospective nickel exploration regions heats up.
BHP chief development officer Johan van Jaarsveld said BHP remained confident in its bid, noting its offer would become live if it won control of 50 per cent of Noront shares.
“Wyloo’s support is not required in order for BHP’s offer to be successful, and we remain confident in our offer. We have the financial strength, world-class mining expertise, and commitment to work in partnership with stakeholders to advance Eagle’s Nest and the Ring of Fire,” he said.
Wyloo had previously complained the Noront board had not given it access to internal company information to conduct due diligence investigations unless it agreed to halt any further move on the company’s stock while it was doing so.
Mr Coutts told Noront shareholders it was prepared to allow Wyloo into its data room if the company signed a confidentiality agreement.
“With BHP’s consent, Noront intends to provide Wyloo with a confidentiality agreement in the same form as Noront’s confidentiality agreement with BHP, but without the customary standstill provision,” he said.
“This will allow Wyloo to complete the due diligence that Wyloo claims is required, and to decide whether or not to make a binding offer to acquire the common shares of Noront that Wyloo does not already own.”
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