Forrest eyes nickel supplier
Andrew Forrest has launched a $760 million takeover bid for a BHP nickel supplier.
Billionaire Andrew ‘Twiggy’ Forrest’s private company, Wyloo Metals, made the takeover bid for Mincor Resources, a key nickel producer for mining giant BHP, this week.
The offer, which has been pitched at $1.40 per share, represents a 35 per cent premium on Mincor’s closing price on Monday.
Wyloo currently owns 19.99 per cent of Mincor, which suffered a $54.7 million loss in the six months to December 31, 2022.
Mincor is also a crucial supplier to BHP’s Nickel West business.
Wyloo said the cash bid was part of a strategy to invest in and develop minerals projects for the rapid decarbonisation of the global economy.
Mincor last year revived its Kambalda nickel operations, enabling the restart of the BHP concentrator, which had been in care and maintenance since 2018.
The Kambalda precinct was broken up by Western Mining, but Wyloo sees strategic value in putting it back together.
Wyloo CEO Luca Giacovazzi has had his eye on Mincor since 2019. Although BHP owns the Kambalda concentrator, Mincor has the dominant land package in the area and is hopeful of finding additional mineralisation around its Cassini and Northern operations.
Wyloo believes its offer represents attractive value to Mincor shareholders, given the risks and uncertainties associated with remaining a shareholder in the face of prevailing economic and equity market risks.
The Mincor share price has fallen 49 per cent in the past 12 months.
Mincor has an off-take agreement with BHP, but it is not long term and covers only part of the production from Mincor’s underground nickel sulphide mines.
Wyloo previously beat BHP in a takeover battle for Noront Resources and its high-grade nickel discovery in Canada.
Forrest has been active in the mining industry for many years and is currently developing a giant green energy hub in Western Australia’s Pilbara region.
The project, known as the Asian Renewable Energy Hub, aims to export clean energy to South-East Asia.