China’s largest steelmaker, Baosteel, has announced a joint conditional off-market takeover of West Australian mining company Aquila Resources.
Baosteel already owns 20 per cent of Aquila, and will carry out the takeover of the remaining shares at the price of $3.40 per share, at a total takeover price of $1.14 billion.
Aquila received a letter from Baosteel Resources Australia and Aurizon Operations Limited on Saturday morning explaining the proposition.
Aurizon will be acquiring 15 per cent of the shares if the deal is successful.
Aquila controls the long delayed $7 billion West Pilbara Iron Ore Project, and is currently trading at $2.45.
Baosteel and Aurizon have advised Aquila that they intend to submit the proposal directly to the shareholders, and have also voiced their desire to secure a board recommendation.
Goldman Sachs were appointed as financial advisor for the deal.