Switzerland-based mining company Xstrata plc and Australia-based, West Africa-focused iron ore company Sphere Minerals Limited have announced that Sidero Pty Limited, a wholly owned subsidiary of Xstrata plc, and Sphere have entered into an agreement for an all-cash offer by Xstrata to acquire all of the issued and outstanding shares of Sphere.
Xstrata's offer is for AU$2.50 per share, valuing Sphere at approximately AU$428 million (US$383 million). The offer represents a 61 percent premium over the closing price of AU$1.55 per Sphere share on the Australian Securities Exchange (ASX) on August 23, 2010 and a 73 percent premium over the volume weighted-average price of Sphere shares over the last 30 trading days on the ASX. The offer will be financed through Xstrata's existing credit facilities and cash on hand.
Sphere has interests in three iron ore projects in Mauritania, West Africa.