The battle over Freewest Resources Canada Inc . and its rich chromite deposits in Northern Ontario has ended with Cliffs Natural Resources Inc. saying it is proceeding with its takeover offer after a rival hostile bid from Noront Resources Ltd. failed to garner sufficient shareholder support.
Montreal-based Freewest said Monday that only 11.8 million, or 4.5 per cent, of its outstanding shares were tendered to the Noront bid, which expired last Friday.
U.S. iron and coal giant Cliffs' bid is to acquire Freewest for $1 per share, which values the company at about $240-million.
The takeover is expected to close in January after shareholders vote at a special meeting.
The fight over Freewest had Cleveland-based Cliffs against Toronto-based junior miner Noront. Both sides over the past few weeks had been engaged in a bitter war of words, with competing claims over which company is best positioned to realize the full value of the chromite deposits.
"We realized from the onset that the successful takeover of Freewest would be a challenge, but it offered significant potential value to all shareholders, thereby justifying the effort," Noront president and chief executive Wes Hanson said in a statement.
Cliffs has stated it plans to spend about $800-million (U.S.) to build a mine and facilities and produce between 400,000 and 800,000 tonnes of ferrochrome from the chromite ore at the Northern Ontario site, known as the Ring of Fire.
Ferrochrome is a key ingredient in stainless steel.Report Typo/Error