Hancock Prospecting has achieved a breakthrough in its takeover bid for Riversdale Resources by gaining acceptance of the offer from the coking coal company’s largest shareholder.
Resource Capital Fund (RCF VI) has accepted the bid after previously stating it might go back on its decision should Hancock acquire more than 50 per cent of Riversdale.
The Gina Rinehart-owned subsidiary has now successfully acquired a minimum stake of more than 85 per cent (88.23 per cent) in Riversdale, two days after making its latest increase to the offer price, with the latest acceptances.
Hancock’s latest offer saw it increase the price to $2.70 a share, up from its initial offer of $2.20 in February this year.
The company is approaching the 90 per cent interest threshold for compulsory acquisition, which when achieved will see it acquire the entire target company.
“I am delighted to be able to confirm that Hancock has achieved an interest in more than 85 per cent of Riversdale,” Hancock chair Gina Rinehart said.
“For a long time, Hancock has wanted to find a good metallurgical coal opportunity to complement our iron ore projects – both commodities being critical for steelmaking.
“Grassy Mountain is a good strategic fit for Hancock that adds to our existing iron ore interests in Hope Downs, Roy Hill and Atlas Iron.”
Riversdale’s Grassy Mountain coal project in Alberta, Canada is forecast to produce 93 million tonnes of coking coal over a 24-year mine life.
Hancock chief executive Garry Korte said the company looked forward to working with Riversdale’s employees and the Canadian Federal and Alberta governments to progress Grassy Mountain.
The latest offer has been automatically extended by 14 days to May 21 under the Corporations Act to receive acceptances from remaining Riversdale shareholders.