China bids voracious for commodities....Vale Won’t Raise Metorex Bid, Paving Way for $1.36 Billion Jinchuan Deal
By Carli Lourens – Jul 11, 2011 10:07 AM MT
Vale SA (VALE3), the world’s largest iron- ore producer, said it agreed to terminate its proposed acquisition of Metorex Ltd. (MTX), paving the way for a rival $1.36 billion bid from China’s Jinchuan Group Co. to win control of the copper company.
“Vale has no intention to match the terms of the recently announced offer for Metorex,” the Rio de Janeiro-based company said in a statement today. Metorex asked Vale to terminate its proposal after Vale notified the Johannesburg-based company that it won’t amend its 7.35 rand ($1.08) a share offer to beat Jinchuan’s 8.90 rand a share.
Vale’s withdrawal will become effective once Metorex pays Vale a previously agreed 75 million-rand ($11 million) break-up fee, Metorex spokesman Jacques de Bie said today by telephone.
The battle for Metorex’s copper and cobalt mines in Zambia and the Democratic Republic of Congo pitted Vale against China’s biggest nickel producer as companies from the largest natural- resource consumers scour Africa for mines. The Chinese are “aggressive and hungry” for raw materials, Liberian President Ellen Johnson Sirleaf said last month.
“The decision is consistent with Vale’s rigorous discipline in capital allocation,” the company said in the statement today, adding it has “significant growth opportunities.”