Hancock Prospecting subsidiary Redstone Corporation will increase its price for Atlas Iron shares from 4.2 cents to 4.6 cents per share on the condition that its stake of the company increases from 77 per cent to 87 per cent by the close of the offer.
Redstone stated earlier this month it would increase its offer from 4.2 cents to 4.45 cents per share under similar conditions, a revision which was intended to be final at the time.
In April, Mineral Resources announced plans to takeover Atlas Iron for $280 million, sparking a bidding war.
Hancock then superseded Mineral Resources offer of $280 million with a $390 million bid, which Atlas Iron eventually urged shareholders to accept.
Yesterday, Hancock pointed out that if its shares in Atlas haven’t increased from 77 to 87 per cent by the closing period of the revised conditional offer on October 2, then Atlas shareholders who accept would not receive the increased offer price of 4.6 cents per share (a 9.5 per cent premium on the previous price).
In addition, if Redstone reaches the 87 per cent figure within the last seven days of the offer period, it will be automatically extended by 14 days.
“We believe that there are a number of Atlas shareholders who have not yet accepted our offer that will see value in the increased conditional offer price of $0.046 per Atlas share,” said Hancock chief executive officer Garry Korte.
“Support from the remaining Atlas shareholders will allow all Atlas shareholders who have already accepted the offer to benefit from a higher price.”