South Africa: Xstrata Likely to Take Money And Run From Lionore

GLOBAL resources group Xstrata was likely to walk away from the bidding for nickel producer LionOre International after Norilsk Nickel raised its bid to C$27,50 a share, Numis Securities analyst Simon Toyne said in a note to clients yesterday.

Norilsk's bid is now 10% higher than Xstrata's increased offer and about 50% higher than Xstrata's original bid. For Xstrata to raise its bid by another 10% would destroy any value that it hoped to get from the deal.
Africa 2007

A more attractive option would be for Xstrata to accept the break fee of $280m, walk away from the bid and look at other merger and acquisition opportunities, Toyne said.

Read Full Article from AllAfrica.com

- Posted: 2007-05-24 10:12:15

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