Lundin Mining is not in favour of the hostile takeover bid from Equinox Minerals. The unsolicited Canadian $4.7 billion bid should be rejected by shareholders if the board of director’s recommendation is to count. Equinox Minerals itself has refused a $6.3 billion offer from China’s Minmetals Resources calling it opportunistic.
The chief executive of Equinox Minerals, Craig Williams said that the offer sought to frustrate its own offer for Lundin Mining. Based on this the chief executive of Ludin Mining, Phil Wright said that the position of Equinox was very hypocritical as it was urging the shareholders of Lundin Mining to accept an offer that was significantly worse.
Lundin Mining does not believe that Equinox Minerals will be able to meet its production forecast of 500,000 tonnes of copper annually from the combined company. It is also worried about the debt that it will mount up as it arranges financing for taking the deal through. Lundin Mining feels that the debt would be dangerously high for the new company to be comfortable with it.
Copper mining companies have been caught up in a sweep of consolidation recently as prices for the commodity rise to record highs. However as far as Lundin Mining is concerned, its unwanted suitor is definitely not an acceptable one.