Freewest Resources Canada Inc. is urging its shareholders once again not to tender their shares to a takeover bid from Noront Resources Ltd. set to expire Friday.
Freewest has been trying to fend off the junior Ontario-based mining company since early October and has recommended its shareholders instead vote in favour of a friendly bid from Cliffs Natural Resources .
Freewest called Noront's bid inferior compared to Cliffs' offer, recently sweetened to $1 per share in stock from a previous offer of 90 cents per share. The increased offer values Montreal-based Freewest at $240-million.
Freewest shareholders will decide on the Cliffs offer at a meeting scheduled for January 15, 2010.
Noront had earlier said its final offer had an implied value of 93.5 cents per share but Freewest later disputed that calculation, saying some of that bid included share purchase warrants that could be worthless, depending on market prices. Freewest added that as a junior exploration company Noront did not have the financial capacity to develop the Ring of Fire region it was interested in.
"Noront's claims cannot be trusted," said Freewest in a statement issued Friday morning. "Cliffs is a stable and profitable company, with significant international assets and operations ... Freewest unanimously recommends that Freewest shareholders reject the Noront offer and not tender their shares."
Freewest's chief assets are its chromite deposits in the James Bay region of northern Ontario, which Cliffs wants to develop into a new mining operation.
Cliffs, an international iron and coal company which lists its shares on public markets in New York and Paris, is already a significant minority shareholder of Freewest.
Noront is focused on developing its nickel-copper-platinum-palladium, chromite, gold and vanadium discoveries in the Ring of Fire mining district.
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