Fortescue’s interest in Red Hawk Mining has increased to 66.23 per cent, making the iron ore miner the company’s majority shareholder.
The increased shareholding follows Red Hawk’s largest shareholder, TIO (NZ), accepting Fortescue’s $254 million takeover offer. As of January 24, TIO held a 60.71 per cent interest in Red Hawk.
Fortescue has agreed to waive the bid condition 14 days after acquiring a relevant interest in at least 50.1 per cent of Red Hawk shares. Then the offer will be unconditional and shareholders who have accepted it must be paid within 10 business days.
“The board continues to unanimously recommend that Red Hawk shareholders accept the offer at either the base offer price or, if relevant, the Increased offer price, in the absence of a superior proposal and subject to the independent expert continuing to conclude that the offer is fair and reasonable, or not fair but reasonable,” Red Hawk said.
“Further, Red Hawk is pleased to advise that each of the Red Hawk directors who hold or control Red Hawk Shares intends to accept the offer in respect of all the Red (Hawk) shares they hold or control.”
Originally announced last week, Fortescue struck the deal with Red Hawk via a binding bid implementation deed.
Under the agreement, Fortescue would acquire all of Red Hawk’s fully paid ordinary shares for cash consideration of $1.05 per share, increasing to $1.20 per share if Fortescue acquires a 75 per cent or more interest in Red Hawk within seven days.
The centre of the proposed acquisition is the Blacksmith iron ore project, which is located 30km west of Fortescue’s Solomon operations in the Western Hub.
Blacksmith’s total mineral resource estimate currently sits at 243 million tonnes at 59.3 per cent iron grade.
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