Chinese steelmaking giant Sinosteel has raised its stake in Western Australian iron ore miner Midwest Corporation from 43.62 percent at the time of its last filing on June 13, to 45.58 percent as of July 4, offering a US$1.36 billion takeover bid, or AU$6.38 (US$6.10) per share.
Sinosteel has been struggling with Murchison Metals Ltd to take over Midwest since March 2008 when it submitted its offer to acquire Midwest. However, both Sinosteel and Murchison have enough shares to block each other's plans to take over Midwest.
The refusal by Murchison to accept the $6.38 cash per share bid by Sinosteel for its 10 per cent stake will effectively block a compulsory takeover of Midwest by the Chinese steelmaker.
Moreover, Australian iron ore miner Murchison Metals Ltd today dropped its competing plan for a merger with Midwest, as it did not have the support of major shareholder Sinosteel.