Chinese iron and steel giant Baosteel Group Corp (寶鋼) yesterday said it was readying a takeover bid for Aquila Resources Ltd that values the Australian iron ore and coal firm at A$1.4 billion (US$1.3 billion).
Baosteel Resources Australia, a subsidiary of the Chinese parent’s overseas development arm, and Australian rail freight operator Aurizon are offering A$3.40 per share in cash for the company.
The conditional off-market proposal represents a premium of 38.8 percent to Aquila’s close on Friday last week of A$2.45. Shares in the firm surged on the news and closed up 36 percent at A$3.34 yesterday.
Baosteel Resources International chairman Dai Zhihao (戴志浩) said as the bidders had been unable to meet the Aquila board, they had decided to take the offer directly to shareholders.
“We believe this is a compelling offer for Aquila shareholders as it provides an opportunity for them to realize certain value for their Aquila shares at a significant premium to current market prices ... at a time of uncertainty of the funding and development pathway for Aquila’s suite of greenfield projects,” he said in a statement.
He said the deal was in line with Baosteel’s strategy of building a leading global steel and resources business by developing Aquila’s Pilbara iron ore project in Western Australia and a hard coking coal development at Eagle Downs in Queensland.
Baosteel, which already has a near 20 percent stake in Perth-based Aquila, said the offer was designed to push progress on the projects the Australian firm was reportedly unable to secure funding for on its own.
“After five years, we haven’t seen any projects started,” Baosteel Resources Australia vice president Wu Yiming said. “Our original intention was to support Aquila in developing its projects... Now we want to get things started.”
Aurizon chief Lance Hockridge said the offer “would provide attractive returns for the owners of Aurizon and for Baosteel, of course, secures further access to a very high quality, low cost iron-ore project and coal.”
“This cooperation represents a co-investment by Australia’s largest rail freight operator and one of China’s leading iron and steel producers to develop quality Australian resources,” Hockridge added.
The takeover had the potential to develop a new world-class iron ore district in the western Pilbara, supported by an integrated multi-user rail and port solution, he said.
The offer comes after an Australian-Chinese consortium last week secured a 98-year lease on Australia’s largest coal export port.
Merida Industry Co (美利達) has seen signs of recovery in the US and European markets this year, as customers are gradually depleting their inventories, the bicycle maker told shareholders yesterday. Given robust growth in new orders at its Taiwanese factory, coupled with its subsidiaries’ improving performance, Merida said it remains confident about the bicycle market’s prospects and expects steady growth in its core business this year. CAUTION ON CHINA However, the company must handle the Chinese market with great caution, as sales of road bikes there have declined significantly, affecting its revenue and profitability, Merida said in a statement, adding that it would
i Gasoline and diesel prices at fuel stations are this week to rise NT$0.1 per liter, as tensions in the Middle East pushed crude oil prices higher last week, CPC Corp, Taiwan (台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. International crude oil prices last week rose for the third consecutive week due to an escalating conflict between Israel and Iran, as the market is concerned that the situation in the Middle East might affect crude oil supply, CPC and Formosa said in separate statements. Front-month Brent crude oil futures — the international oil benchmark — rose 3.75 percent to settle at US$77.01
RISING: Strong exports, and life insurance companies’ efforts to manage currency risks indicates the NT dollar would eventually pass the 29 level, an expert said The New Taiwan dollar yesterday rallied to its strongest in three years amid inflows to the nation’s stock market and broad-based weakness in the US dollar. Exporter sales of the US currency and a repatriation of funds from local asset managers also played a role, said two traders, who asked not to be identified as they were not authorized to speak publicly. State-owned banks were seen buying the greenback yesterday, but only at a moderate scale, the traders said. The local currency gained 0.77 percent, outperforming almost all of its Asian peers, to close at NT$29.165 per US dollar in Taipei trading yesterday. The
RECORD LOW: Global firms’ increased inventories, tariff disputes not yet impacting Taiwan and new graduates not yet entering the market contributed to the decrease Taiwan’s unemployment rate last month dropped to 3.3 percent, the lowest for the month in 25 years, as strong exports and resilient domestic demand boosted hiring across various sectors, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday. After seasonal adjustments, the jobless rate eased to 3.34 percent, the best performance in 24 years, suggesting a stable labor market, although a mild increase is expected with the graduation season from this month through August, the statistics agency said. “Potential shocks from tariff disputes between the US and China have yet to affect Taiwan’s job market,” Census Department Deputy Director Tan Wen-ling
RSS