ArcelorMittal and Nunavut now own 90 percent of Baffinland, extend offer

Monday, 07 February 2011 16:21:35 (GMT+2)

Luxembourg-based steelmaking goliath ArcelorMittal and Canada-based Nunavut Iron Ore Acquisition Inc. (Nunavut Iron), a subsidiary of US-based Iron Ore Holdings LP, now own 90 percent of Canadian miner Baffinland Iron Mines Corporation (Baffinland) through their C$590 million ($593 million) joint offer, after acquiring 89,710,019 more common shares. The joint stake was 65 percent before this recent transaction. The offer has also been extended until the end of February 17.

The offer seeks all shares of the company for C$1.50 (US$1.51) in cash per common share. Under the joint offer, ArcelorMittal and Nunavut Iron would own 70 percent and 30 percent of Baffinland respectively.

The companies decided to cooperate on January 14, following various rival bids to acquire Baffinland.

C$4 billion project

Baffinland's Mary River project has proven reserves of about 365 million metric tons of ore, grading an average of 65 percent iron, and about 500 million mt of ore resources. For some months now Baffinland has been looking for partners for the C$4 billion (US$4.02 billion) project, which is expected to produce 18 million mt per year.

ArcelorMittal has already received the necessary approvals for acquisition from local authorities, also valid for the joint offer.