Cliffs pays £2.64bn for Consolidated Thompson
CLIFFS Natural Resources has agreed to buy Canada’s Consolidated Thompson Iron Mines for C$4.07bn (£2.64bn), aiming to expand its capacity to feed Asia’s appetite for iron ore.
The Cleveland, Ohio-based iron ore and coal miner said it wants to be able to cater to booming markets like China and India that are undergoing rapid urbanisation.
“It was just a matter of time as to when Cliffs would step in to buy Consolidated Thompson,” said Stonecap Securities analyst Gary Hon, pointing to the proximity of the two companies’ Quebec operations.
Cliffs will pay C$17.25 a share for Consolidated Thompson, which has about 236m shares outstanding. Consolidated’s largest shareholder has accepted the offer.
The price represents a 29 per cent premium on Consolidated’s close on the Toronto Stock Exchange. The deal price, including assumed debt, comes to C$4.9bn, Cliffs said.
The deal could expand Cliffs’ projected 2011 North American ore sales by more than a quarter to about 34.5m tons.