KGHM to buy Quadra FNX for about C$3 bln |
| Reuters - Dec 6, 2011 |
Polish copper miner KGHM has agreed to buy Canadian rival Quadra FNX for a hefty premium, targeting the world's No.4 spot by expanding its asset base in politically safe mining jurisdictions.
KGHM shares tumbled by over 10 percent on the news on Tuesday, while Quadra jumped beyond the C$15 per share KGHM agreed to pay -- a premium of a third over the target's market price before the news, indicating some investors expect a higher bid.
The zloty's decline also accelerated after the news amid expectations of additional supply of the Polish currency on the foreign exchange market.
"The price KGHM is paying is quite a lot higher than the target's market price, and secondly these assets are not of the highest value. The argument is that spending 10 billion zlotys will mean there will be a lot less money for a dividend," said Tomasz Duda, analyst at Ipopema Securities in Warsaw.
Read Full Article from Reuters
- Posted: 2011-12-06 11:20:28
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