[ferro-alloys.com]Australia's Hancock Prospecting subsidiary Redstone has sweetened its takeover offer for fellow Australian company, iron ore miner Atlas Iron, the takeover target said in a statement to the Australian Securities Exchange Thursday.
"Redstone has stated that its offer price will increase to A4.45 cents ( $3.21 cents) per Atlas share if Redstone's voting power increases to 87%, or more during the offer period. If the condition is satisfied, Redstone will also pay an additional A0.25 cents per Atlas share to shareholders who accepted the Hancock Offer prior to any change in the offer price," Atlas said.
Previously the bid was for A4.2 cents per share. Redstone's current voting power in Atlas is 76.3%, Atlas said.
Previously, the directors of Atlas had unanimously recommended Hancock's offer to shareholders.
The offer is currently due to close September 21.
Atlas, which operates in Western Australia's Pilbara region, has been struggling with the impact of discounts for lower-grade iron ore, and higher operating costs.
In 2017-2018 (July-June) fiscal year, the miner sold 9.22 million wet mt of iron ore, which is down 36% from 14.35 million wmt the year prior, Atlas said earlier in the year.
Its' C1 cash cost in the fiscal year was A$39.30/wmt, which is up from A$34.76/wmt in fiscal 2016-2017. Its full cash cost was A$59/wmt, up from A$53/wmt over the same period, it said.
Meanwhile, the company's realized price for iron ore for the period was level with the full cash cost at A$59/wmt, down from A$61/wmt the year before.
Atlas had previously said it will formulate its fiscal 2018-2019 guidance once it has considered the outcomes of Redstone's strategy review, and in the interim will continue operating its Mt Webber mine at around 7 million mt/year.